BROMSGROVE’S MP has accused chancellor Rachel Reeves of failing to deliver a budget for the residents and businesses in the town.
Bradley Thomas MP says Labour’s first budget in more than 14 years, which released today (Wednesday, October 30), does not deliver for working people, farmers, small businesses, pubs or pensioners across Bromsgrove.
After staunchly campaigning against Labour’s imposition of a VAT taxation on private school fees, Mr Thomas expressed his continued discontent with the decision, which he has labelled as a ‘cruel tax’ impacting both state and privately educated pupils.
Mr Thomas said: “This policy will push pupils into the state sector and this Government has no plan to deal with larger class sizes.”
Labour’s budget announced a 19 per cent real-terms increase in funding for the Department for Education (worth £6.7 billion, including £1.4 bn to rebuild schools in need).
The recently elected government has also vowed to provide schools with an extra £2.3bn to support the hiring of new teachers.
It will also provide £2.1bn for school maintenance – a £300m increase – and has announced a £1 bn increase in funding for special needs schools alongside another £300 m for higher education.
Mr Thomas added: “Today the Government finally came clean and revealed what they were planning to do all along: to raise our taxes and unleash a borrowing spree.
“By whacking up National Insurance for employers, it will ultimately be working people who pay the price for this Government’s assault on businesses.”
Employers’ National Insurance contributions will rise from 13.8 per cent to 15 per cent, while NI contributions for employees will remain the same. Income tax is also not expected to rise until the 2028/29 fiscal year.
The Chancellor did announce an increase in capital gains tax, whilst extending the freeze on inheritance tax thresholds, meaning inheritance up to £325,000 will remain tax free.
Rachel Reeves also announced a further freeze on fuel duty, alleviating motorists concerns regarding price per litre increases at pumps.
However, taxes on tobacco and alcohol are increasing along with the retail price index (RPI), while a cut in draught duty will see a 1p per pint reduction for customers.
NHS funding is expected to increase as the government announces its 10 year healthcare plan, targeting 2 per cent productivity growth next year.
A £22.6bn increase in day-to-day health budget in on the horizon, and £3.1bn increase in the capital budget. That includes £1bn for repairs and upgrades, and £1.5bn for new beds in hospitals and testing capacity.
Business rates are going up as tax relief for retail, hospitality and leisure businesses has dropped to 40 per cent. A permanent reduction for these businesses’ rates will be introduced from 2026-27. Employment allowance is up to £10,500.
“Hospitality and retail businesses are being punished further too with an increase in business rates.”
Mr Thomas added: “Debt, borrowing, taxes, and inflation are all going up under this new Government whilst economic growth is going down,” Mr Thomas added.
Reeves announces new rules to not borrow for day-to-day spending. The current budget will be balanced within three years of forecasts.
The government projects to run a deficit of £26.2bn in 2026, but achieve a surplus of £10.9bn in 2027-28, £9.3bn in 2028-29 and £9.9bn in 2029-30.
Public sector net debt is expected to fall from £127bn in 2024-25, falling gradually to £70.6bn by 2029-20.
The budget also revealed new plans for transport including changes for HS2, increases in defence spending, boosted grant funding for local authorities – particularly for social care – and an energy and investment plans.
Labour also announced an £11.8bn compensation scheme for victims of the infected blood scandal, and another £1.8bn for victims of the Post Office Horizon IT scandal.
In a blow to farmers, relief for the inheritance of business and agricultural assets has been impacted. After £1m those assets will attract inheritance tax of 20 per cent, a far cry from the Agricultural Property Relief offered to farmers which has helped for years in enabling the smooth transition of farmland and assets from generation to generation.
“This Government has broken a clear promise they made to our farmers on Agricultural Property Relief.”
“As the President of the National Farmers Union has said, this policy will ‘snatch away the next generation’s ability to carry on producing British food,” Mr Thomas added.
