Rishi Sunak has expressed his intention to further reduce taxes for working people this year, potentially financing these cuts by trimming welfare payments. The prime minister outlined his priorities, emphasizing the pursuit of tax cuts, stricter controls on public spending, and benefits management before the budget in March. This sets the stage for a potential income tax cut, likely the last major tax decision by the chancellor before the upcoming general election.
Sunak highlighted the joint priority of controlling spending and welfare to facilitate tax cuts. He specifically mentioned discipline in public sector pay and benefits, pointing to long-term disability payments as an area where savings could be made. The chancellor emphasized the Conservative approach of rewarding hard work with tax cuts while ensuring that those capable of working actively participate in the workforce.
In a separate statement to the media, Sunak reinforced his commitment to responsible tax cuts, acknowledging that difficult decisions on public spending and welfare control would be necessary. Some Conservative backbenchers, seeking pre-election tax cuts to narrow the poll gap with Labour, welcomed Sunak’s comments. However, there is a contrast with Chancellor Jeremy Hunt’s statement on Saturday, expressing uncertainty about the affordability of further tax cuts this year.
Critics argue that the focus on tax cuts for working people may disappoint those advocating for reductions in inheritance tax. Keir Starmer, the Labour leader, expressed a desire to reduce taxes on working people but accused the prime minister of prioritizing immediate cuts over fostering economic growth.
Sunak specifically mentioned his desire to reduce the number of people claiming benefits due to long-term sickness or disability. This aligns with Hunt’s announcement in November, requiring individuals to seek work they could do from home or risk facing significant cuts to their benefits. Disability charities criticized these measures, asserting that they punished disabled individuals and added anxiety to struggling households.
As MPs return to Westminster, the prime minister faces criticism on various fronts, including potentially damaging byelections triggered by the resignation of MP Chris Skidmore, recalls in Wellingborough, and a potential byelection in Blackpool South. Some within the Conservative Party advocate for a more assertive stance on key issues, including tax cuts and tougher measures on deporting asylum seekers to Rwanda.
Sunak urged colleagues and voters to stay committed to the current plan, emphasizing that sticking to the course would bring about the long-term change the country needs. Despite challenges, he expressed optimism about the progress made and the direction in which the country is heading.