Labour Budget: Reeves delivers for big-business not workers

Lynda McEwan

Labour’s second UK government budget confirms once again that they are a party of big business.

Rachel Reeves tells us that growth will magically fix the ailing economy, but the meagre growth under today’s capitalism means increases in profits for the bosses while prices of food, fuel and utility bills grow and landlords grow rich on inflated rents.

At the same time the working class watch their services shrink, poverty and inflation rise and their communities suffer under continued austerity budgets.

Under her budget that she admits will “hit working people”, 1.7 million workers will be dragged into either paying tax for the first time or pushed into a higher band by an additional three-year freeze on income tax and national insurance thresholds.

Reeves budget will not even guarantee real growth with the fundamental problems of British capitalism persisting, including indebtedness, low productivity and rising inequality. It will also not stave off the effects of the potential of another international financial crash.

Reeves asked “ordinary people to pay a bit more” while she wasn’t even prepared to introduce a wealth tax of 2% which some Labour MPs called for, or hit the massive profits of energy companies and supermarkets.

The budget included a measly national minimum wage rise of 50p per hour and £150 off gas and electric bills when electricity prices are set to rise by 0.2% in January.

This after years of price increases in energy and food prices that have risen for a fifth consecutive month since August. Effectively a few pennies were found down the back of the sofa for working people while the international bond markets and the interests of billionaires are appeased.

Labour may have done a U-turn on the hated two-child benefit cap, however this policy decision was mainly due to the mounting pressure on Starmer’s government.

This is from inside the Parliamentary Labour Party with a possible leadership challenge but most significantly from campaign groups and the trade unions as well as the dire social situation.

Even as Reeves dubiously insists this move will lift 450,000 children out of poverty, the overall household benefit cap remains in place meaning parents are still facing financial hardship through an unfair benefits system that penalises families.

Factoring in the unending cost of living crisis it’s not going far enough to really end child poverty. And the cap will continue until April.

There was an increase in funding for Scotland but nowhere near matching the level of cuts of the past decade.

Will the SNP in their upcoming Scottish government budget use their income tax powers to hit workers rather than the rich? The main criticism Finance Minister Robison raised of Reeves’ budget  was the continuance of the oil and gas levy on capitalist companies.

The STUC has demanded the SNP use similar taxation as Reeves used in the budget on high value homes to raise revenue. Given their woeful record it’s likely they will leave the wealthy alone.

Westminster and Holyrood continue to play the blame game whilst councils, already on their knees, carry out brutal cuts to libraries, women’s services, the NHS and youth services.

Political alternative

The social conditions that result have given rise to right populist Reform UK, who did not present a pro-working class alternative to Reeves pro bosses’ budget.

That’s why the fight for a new mass working-class party based on the trade unions that would fight for socialist policies is so vital.

Your Party has now been founded. We call for it to build and mount a bold anti-austerity, socialist election challenge in May.

Emergency socialist budget policies would mean investment in public services, jobs and a mass campaign of council house building. It would tax the rich and raise wages in line with inflation to at least £15 an hour and benefits in line with the cost of living.

There is plenty of money in society, it’s just being used to appease the capitalist markets.

That’s why socialists fight for taking the commanding heights of the economy, the banks, big business and the energy giants, into democratic workers control and management.