After the UK Budget, We Need to Step Up the Campaign for Wealth Taxes – Richard Burgon MP
Richard Burgon MP
Richard Burgon MP recently addressed a Budget Review event hosted by Arise Festival and the Trade Union Coordinating Group. Read an edited version of his speech published below.
The recent Budget marked a welcome break from over a decade of austerity, especially with the clear rejection of the Tory slash-and-burn plans announced in their last budget. Those would have led to deep cuts throughout this parliament.
A big question, which I will address later, is whether simply ditching those Tory cuts is enough. But we must acknowledge and welcome their rejection. This change is in no small part due to the anti-cuts campaigning by so many people over the past decade.
The Budget’s immediate increases in day-to-day spending for public services over the next couple of years are positive. They will fund welcome measures like 40,000 extra NHS appointments a week and the recruitment of 6,500 new teachers.
It’s also encouraging to see public investment receiving a boost to help rebuild our broken infrastructure. This investment is crucial, as everyone can see the dire state of our crumbling schools and hospitals. Public investment is also a key driver of growth and an essential tool in addressing urgent challenges, such as climate change. So it’s a welcome development to see the Government citing the importance of public investment and this must be backed up with sufficient funding.
There were also steps in the right direction for those of us who believe the wealthiest and tax dodgers should pay their fair share. This is why we’re hearing so much protest from the right-wing press, whose main priority seems to be defending the super-rich.
The progressive tax measures include ending the “non-dom” scheme, some increases in capital gains taxes, requiring private equity to pay more, and ending certain allowances that allowed wealthy individuals to buy large tracts of farmland to avoid inheritance tax. It’s also welcome that the Windfall Tax on oil and gas profits is rising to 38% and will last until at least March 2030, along with a 50% increase in air passenger duty for private jets.
Many of these steps reflect demands the Left has advocated for years. We should welcome them and campaign for them to go further.
I am also pleased by the minimum wage increase of almost 7%, bringing it to £12.21 per hour. I’ve long campaigned against poverty pay, so this is a positive step forward that will raise the pay of thousands in my constituency. For example, a full-time worker at this rate will see a pay rise of £1,400 per year. Altogether, this Minimum Wage boost will help 3 million low-paid workers. Obviously, there is much more to be done to get that £15 per hour we’re campaigning for, but the Minimum Wage Increase and Labour’s Employment Rights Bill are steps in the right direction for workers.
More Needed to Improve Living Standards
While the Budget starts to address the crisis left by the Tories in living standards and public services and starts to make the rich pay more, we need to ask whether it was the game-changer needed to really turn things around in our public services and in the living standards of working people. I believe much more needs to be done.
The break from the planned Tory spending cuts is promising, but I am concerned that the Government’s initial boost to spending over the next couple of years will not continue for the rest of this parliament. These initial increases do need to be sustained if we are to reverse the cumulative effects of a decade of cuts. Much more financial support for public services will be necessary in the coming years.
There’s also a real risk that some unprotected departments could see future cuts. Next Spring, during the Spending Review, each department will receive its budget settlement to the end of this decade. We need to step up our campaigns to ensure no department faces cuts and that all receive the budget increases they deserve.
Another significant issue is whether this Budget will improve living standards. The Government is heavily relying on growth rather than redistribution to achieve this. However, as the Resolution Foundation stated, the Budget does not deliver a decisive shift away from Britain’s record as a stagnation nation. It adds that the outlook for living standards remains weak and warns that “average earnings are forecast to end up in 2029 just shy of where they were in 2008” and that the growth in living standards over this parliament will be the joint-second lowest on record.
So, more will need to be done to break with an era of weak growth and stagnant living standards that have defined the last decade. That will have to include greater levels of public spending and public investment.
If living standards don’t go up then, most importantly, this will create problems for millions of people who have faced a storm of higher food and energy prices as well as flat wages in recent years. It will also create political problems for the Government. Already the tuition fees increase and the Winter Fuel Cut, which I voted against, are alienating voters.
Urgent Action on Poverty
Poverty reduction was the area where the Budget fell shortest. I agree with the Child Poverty Action Group that “the Budget was a missed opportunity to take some of the bold action that is urgently needed on child poverty.”
It’s wrong that the two-child limit and benefit cap were retained. By next April, an additional 63,000 children will be affected by the two-child limit with 200,000 more children affected a year later. The last Labour Government reduced child poverty, and this one needs to do the same and that must include scrapping this cruel Tory measure.
In addition to rising child poverty, the Winter Fuel Allowance cut will make it difficult for many older people already in poverty. This cut must also be reversed.
I am also worried that there could be real-term cuts to working-age benefits planned for next year, with a 1.7% increase from April when inflation is forecast to exceed 2%. Such a cut would be unacceptable and must be opposed. I believe we have to start campaigning for a triple lock on benefits, similar to the triple lock on pensions so those on benefits are not pushed into ever greater poverty. I’m also concerned about what appears to be a continuation of the Tories’ cuts to the work capability assessment. We need to work with disabled people over the coming months to prevent any cuts to the levels of support they receive.
Push for Wealth Taxes
Overall, this Budget has departed from the worst of Tory austerity, but it’s clear much more is needed. We need greater public service investment, more action to improve living standards, and a focus on poverty reduction measures.
For me, this is where wealth taxes come in. I have been campaigning for a range of wealth taxes, particularly a 2% tax on wealth above £10 million. Such a tax could fund significant improvements for millions of people. Recently, I presented a petition in Parliament with over 50,000 supporters calling for this and I plan to continue pushing this demand in the months ahead.
Finally, I want to mention the devastating floods we’ve recently seen in Spain. They underline how we need new sources of revenue to invest in limiting and dealing with the deadly effects of climate change. I will be launching a new Bill in Parliament over the coming months to Make Polluters Pay that will target the fossil fuel companies who caused the climate disaster to make them pay to tackle it.
- Richard Burgon is the MP for Leeds East and the Secretary of the Socialist Campaign Group of Labour MPs. You can follow him on Facebook, Twitter/X, Instagram and TikTok.
- You can watch the Online Budget Review hosted by Arise Festival and the Trade Union Coordinating Group here; or listen on the Arise Festival podcast.
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