The chancellor has hinted that tax hikes could feature in her November Budget as she rules out more borrowing to fill the black hole in Britain’s public finances.
Asked by Sky News whether the hole “whatever the size… will be filled by tax increases, not more borrowing and not spending cuts”, Rachel Reeves said her election promise to “return economic and fiscal stability to the economy” is “solemn”.
She also said the Labour Party’s manifesto commitments “stand” on whether the Government will raise VAT at the Budget later this year, but did not explicitly rule it out.
At the party conference, she has announced a new scheme offering guaranteed work placements to long-term unemployed young people will be subsidised by Government, as she stressed unemployment benefits are not an “alternative” to work.
Meanwhile, she backed the prime minister’s view that Reform UK’s policy of scrapping indefinite leave to remain is “racist”.
Ms Reeves told Times Radio: “I’m going to not play the man, I’m going to play the ball, and that policy I believe is a racist policy.
It comes after defiant Andy Burnham hit back at those demanding he make “simplistic statements of loyalty” to Sir Keir Starmer, saying they were “underestimating some of the peril” Labour was in.
Sir Keir tried to rally Labour MPs at the start of party’s annual conference in Liverpool on Sunday, but was still facing questions from within Labour over his leadership.
Key Points
- Chancellor hints she will go back on pledge to business leaders on tax hikes
- Reeves refuses to rule out VAT rises but says Labour manifesto 'stands'
- Starmer says Farage's migration plan is 'racist' and 'immoral'
- Burnham says Labour must change ‘climate of fear'
- Andy Burnham refuses to make 'simplistic statements of loyalty' to Keir Starmer
- David Lammy to announce expansion of 'intensive supervision courts' to tackle reoffending
Analysis: Is the government gearing up to break its manifesto on tax rises?
09:27
,
Millie Cooke
In its election manifesto, Labour promised no tax rises on working people, including income tax, VAT or national insurance contributions.
And as speculation has run rife ahead of budgets, the government has always been forced to deny plans to break their manifesto pledges. Typically, they'd say they remained "committed" to those pledges.
But since yesterday, when the prime minister was questioned on the BBC ahead of Labour's annual conference in Liverpool, some new language has emerged, with Sir Keir saying the manifesto pledges "stand".
Rachel Reeves repeated the same language on Monday. While the government is still indicating plans to stick to those pledges, the change in language has sparked fevered speculation around a possible VAT rise, partly because "the commitment stands" is a much more passive way of saying the same thing they've always been saying, which perhaps might make it easier for them to break the commitment later down the line.
Speculation was only spurred on by the fact that the chancellor broadly confirmed that taxes in general would need to be increased at the budget, saying "the world has changed".
Reeves hints she will go back on pledge to business leaders on tax hikes
09:20
,
Holly Evans
The chancellor was asked this morning on BBC Radio if she planned to go back on her pledge to business leaders made in November last year after her first Budget that she would not “come back (to them) … with more borrowing or more taxes.”
She replied: “Look, everyone can see that in the last year the world has changed and we are not immune to that change, whether it is wars in Europe and the Middle East, increased barriers to trade because of tariffs coming from the US, whether it’s the global cost of borrowing - we are not immune to those things.”
Following her first Budget, in which bosses’ NI contributions were increased, Ms Reeves told the CBI last November she was “not going to coming back with another load of tax rises or indeed higher borrowing” to fund public services.
She went on: “I have now set the envelope for government spending for the next few years, so I'm not going to need to come back and top that up, either with more borrowing or more taxes.”
Reeves refuses to rule out VAT rises but says Labour manifesto 'stands'
09:11
,
Holly Evans
Rachel Reeves said she was “determined not to increase those key taxes that working people pay” and that the Labour manifesto “stands”, amid questions about whether she would raise VAT.
Asked whether she would raise VAT, the Chancellor told ITV’s Good Morning Britain: “The manifesto stands and it stands for a reason that working people bore the brunt of the economic mismanagement of the last government and the cost-of-living challenges are still people’s number one biggest concern.
“That’s why I’m determined to make working people better off and why I’m determined not to increase those key taxes that working people pay, and that’s why we made those commitments in the manifesto, and that’s why we stand by them.”
Asked to rule out an increase to VAT, she said: “The manifesto stands and it stands for a reason.”
She repeatedly would not explicitly rule out raising VAT, saying she did not want to go through the manifesto “line by line” before the budget and that “as soon as you answer one question you’ll move on to the next one”.
Burnham 'risks going the way of Liz Truss', says Reeves
09:03
,
Holly Evans
Rachel Reeves suggested Andy Burnham “risks going the way of Liz Truss” as she warned being Chancellor meant saying “no to good causes” to make sure “the numbers add up”.
Asked whether she agreed with the Prime Minister, who last week appeared to liken Mr Burnham’s economic agenda to that of the former Tory prime minister, she told LBC: “If he’s saying… anybody that says you can just borrow more, I do think that risks going the way of Liz Truss.
“Already one pound in every 10 the Government spends is on financing the debt that was racked up by the previous Conservative government.
“There’s nothing progressive, nothing Labour about that.
“I want to bring that debt down. I want bring that debt down I want to bring those borrowing costs down.
“That means having to make difficult decisions and having to say no. And whoever’s chancellor of the exchequer they need to be able to say no to colleagues.
“They need to be able to say no to good causes because they’ve got to make sure the numbers add up. And with me as Chancellor, they always will.”
Reeves keeps door open to cut two-child benefit cap
08:43
,
Holly Evans
Rachel Reeves has kept the door open to cutting the two-child benefit cap, saying she joined the Labour Party because she cares about children.
The chancellor told BBC Radio 4’s Today programme it is “a decision for the Budget”, suggesting an announcement will not come at Labour’s conference to ease pressure from backbenchers, as some had expected.
But she added: “No one needs to tell me about child poverty. I came into this party because I desperately care about children and their life chances.“It's why we've done free school meals, it's why we've done breakfast clubs.
“It's why we've increased the national living wage and the national minimum wage. So I'm a chancellor that cares about child poverty. We will reduce child poverty, but we've also got to make sure the numbers add up.”
Reform will deport your neighbours, Reeves warns
08:35
,
Archie Mitchell
Rachel Reeves has hit out at Reform’s “racist” immigration policy again, doubling down on Sir Keir Starmer’s allegation.
In a passionate attack on Nigel Farage’s party, she said: “It’s one thing to say that people who are here illegally should be sent home. It is quite another thing to say the person who's sitting next to you at work today, who was born abroad should be deported.
“It’s quite a different thing to say your next door neighbor who goes to work every day and contributes to our country, sends their kids to the local school, volunteers at the community center because they weren't born here, they're going to be deported,
“Those policies are racist, and we will call them out.”
‘There have been difficult days… some have been very public,’ Reeves says
08:26
,
Holly Evans
Rachel Reeves said she was “genuinely loving this job” while acknowledging there had been “difficult days” as Chancellor, and conceding there was “more to do.”
Asked how she was managing the job personally, she told BBC Breakfast: “I’ve been Chancellor now for 451 days.
“There have been difficult days – some of them have been very public.
“But I wouldn’t swap them for any of the 5,000 days I spent in Opposition before that, because every one of those 451 days has been an opportunity to change our country for the better.”
She added: “Has it been easy? No. I didn’t go into this thinking it was going to be easy.
“I’m really proud of what we’ve done. I’m the first to admit there’s more to do.
“We’re 15 months into this Government and as the first Labour chancellor in 14 years and the first female chancellor in 800 years, I am genuinely loving this job and the chance to serve, because that’s what I came into this for – just the chance to serve and make our country a bit better off.”
Reeves refuses to rule out extending stealth tax
08:05
,
Holly Evans
Rachel Reeves has refused to rule out extending a stealth tax she promised as chancellor to lift.
The chancellor was pressured over the current frozen tax rate thresholds, which force people into higher tax brackets as inflation rises. They are currently frozen into 2028, but she has previously promised to unfreeze them.
Asked by BBC Breakfast whether she can guarantee the freeze will be lifted, she said: “We are at risk of sort of writing a Budget live on air. I'm not going to do that for obvious reasons.”
Reeves sheds light on detail as she sets out benefit vow
08:00
,
Archie Mitchell
Rachel Reeves has been asked repeatedly what kind of jobs will come as part of her guarantee to get young people off benefits and into work.
The chancellor has been unable to offer a single example of an employer who is on board with the plan, which will see those coming off benefits offered guaranteed paid employment.
Those who refuse face being stripped of their benefits. She said “the jobs could be in a whole range of sectors” when asked by the BBC, adding that the plan has been “welcomed by business organisations”.
But she has been unable to say what kind of roles young people would be offered or by whom, promising to set out more details at the Budget in November.
Rachel Reeves hammers home her ‘line’
07:54
,
Archie Mitchell
It is always interesting watching government ministers take on multiple broadcast interviews on the so-called “morning round”.
Different interviewers take different paths and prioritise different stories, but there are always some constants.
At only 7.30am, Rachel Reeves has now repeated her go-to “line” multiple times, and will continue to do so as she faces a handful more interviews.
Facing pressure ahead of the Budget, with the economy stagnating, Ms Reeves told Sky News: “If someone had said 15 months ago that we would have had the fastest growing economy in the G7 in the first half of this year, five cuts in interest rates and trade deals with the biggest economies in the world, the US, India, and the European Union, I think you would have said, I don't think so, chancellor. But we have achieved those things and I'm proud of them.”
She said almost exactly the same more than once on BBC Radio 5 Live and will no doubt repeat it elsewhere.
Reeves hints Budget will see tax hikes not more borrowing
07:38
,
Archie Mitchell
Rachel Reeves has hinted the black hole in Britain’s public finances will be filled with tax hikes and not more borrowing when she delivers November’s Budget.
Asked by Sky News whether the hole “whatever the size… will be filled by tax increases, not more borrowing and not spending cuts”.
The chancellor said her election promise to “return economic and fiscal stability to the economy” is “solemn”.
“And that is anchored around the fiscal rules that say that we will pay for day to day spending through tax receipts, and they will get debt down as a share of GDP,” Ms Reeves said.
She also hinted spending cuts could be found elsewhere, adding that they would be part of the “combination” used to restore the public finances.
Reeves declines to call Reform policy racist
07:33
,
Holly Evans
Rachel Reeves has declined to follow Sir Keir Starmer in calling Nigel Farage’s immigration plan “racist”.
The chancellor joined the prime minister in criticising it as “immoral” and wrong.
But asked directly whether she agreed with Sir Keir that it is “racist”, she avoided repeating the claim.
Speaking to BBC Radio 5 Live, she said: “I do think that is wrong and an immoral policy, and it's not one that we would pursue.”
Chancellor admits there is ‘more to do’
07:28
,
Holly Evans
Rachel Reeves has been challenged after touting the performance of the economy under Labour.
Speaking to BBC Radio 5 Live, the chancellor said: “If someone had said 15 months ago, you'd have the fastest growing economy in the G7, five cuts to interest rates, more jobs in the economy, and three trade deals with the biggest trading blocks in the world, the US India and the European Union.
“People said that wouldn't be possible, but we've achieved that, and I'm proud of those achievements.”
Presenter Nicky Campbell quickly rebutted, telling Ms Reeves: “I'm just quite surprised to hear your characterization of how things are going, because growth is slowing down to the point of being stagnant.
“According to the latest figures that we've got, businesses are clearly fed up. There are 150,000 fewer payroll jobs after your first budget. And this, this is, this is all on you, isn't it? You know, do you not recognize that?”
Ms Reeves replied: “Well, I’m the first to say there is more to do.”
Reeves: If you can work, you should
07:22
,
Archie Mitchell
Rachel Reeves is setting out Labour’s plans to ensure young people who can work take up offers of employment, do.
The chancellor has said those who have been on universal credit for 18 months, who do not re-enter the education system or take up an apprenticeship, will be offered guaranteed paid work.
She admitted no businesses have signed up to provide the guaranteed jobs, because “we have not got to that stage yet”.
But she said businesses would be signed up between today’s announcement and her Budget in November. Those who do not accept the guaranteed paid work face being stripped of their benefit payments under Labour’s plans.
Australia's Albanese vows to defend democracy at UK Labour conference
07:09
,
Alisha Rahaman Sarkar
Australian prime minister Anthony Albanese has hailed the UK–Australia relationship as he vowed to "defend democracy itself" alongside "my mate", Sir Keir Starmer.
The two leaders embraced on stage in Liverpool at the UK Labour Party conference yesterday.
"We all know this is a time when trust in governments and institutions is under challenge," Mr Albanese said.
He said he shared a "determination" with the British prime minister and an "absolute resolve to stand together and defend democracy itself".
"Tearing things down is easy but it doesn't leave you with anything. The low politics of fear and resentment are easy but they only divide the country, they don't advance it," he said.
Labour takes fight to Reform on diversity
06:52
,
Alisha Rahaman Sarkar
Labour is taking the fight to Trumpian critics of diversity and equality, with the tech secretary vowing to “smash the glass ceilings” holding women and people of colour in the tech industry back.
With Reform UK threatening to sack diversity officers in councils across the country, Liz Kendall is taking the fight to Nigel Farage and ramping up the government’s efforts to boost representation.
On current trends, it would take 283 years for women to make up an equal share of the tech workforce, according to the BCS Chartered Institute for IT.
Archie Mitchell has more.
‘No to Digital ID’ protests held near Labour Party conference
06:35
,
Alisha Rahaman Sarkar
Protesters gathered outside the Labour Party conference in Liverpool yesterday to oppose plans for a new national digital ID card.
Demonstrators carried banners reading “No to digital ID”, as they warned the scheme could pave the way for surveillance and the exclusion of vulnerable groups. The protest remained peaceful under police watch.
The protest comes days after Sir Keir Starmer unveiled proposals for a new “BritCard” digital ID system.
More here.
Labour must change ‘climate of fear’, says Burnham
06:08
,
Alisha Rahaman Sarkar
Andy Burnham hit out at a “climate of fear” in Labour as he called for a “debate on our direction” on the first day of the party’s conference in Liverpool.
The Greater Manchester mayor was greeted with multiple rounds of applause as he criticised the Labour leadership’s handling of dissent, attacking a situation where party members were “suspended for liking a tweet by another political party” or “a Member of Parliament loses the whip for trying to protect disability benefits”.
He said: “One thing I am worried about, and I think we do need to debate at this conference in my view, is how can you have an open debate about all of those things if there’s too much of a climate of fear within our party and the way the party is being run.”
More here.
Ed Miliband says ‘possible’ that UK government should leave X
05:50
,
Alisha Rahaman Sarkar
Energy minister Ed Miliband has said it is “possible” the government should come off X, because Elon Musk is a “dangerous man”.
Speaking at a fringe event at the Labour conference, Mr Miliband said: “It’s not just that [Nigel] Farage wants less workers’ rights and all those things. Even though he poses as something else, he is now part of a global network of the far right, a global network of billionaires like Elon Musk who want to take away people’s rights, take away people’s freedoms, and we need to have that argument.”
Mr Miliband said of Musk: “He called for the overthrow of our government. He incited violence on our streets. His platform, X, promotes disinformation. He’s a dangerous person.”
Asked if that meant the government should leave X, he said: “It’s possible.”
Mr Musk appeared via video link at a far-right rally in London organised by convicted criminal Tommy Robinson, where he called for a “change of government”. He said: “Whether you choose violence or not, violence is coming to you. You either fight back or you die.”
Five things Keir Starmer must do at the Labour conference after devastating poll
05:30
,
Alisha Rahaman Sarkar
With Andy Burnham and left-wing Labour rebels threatening to oust him on one side and Nigel Farage taking Labour voters away on the other, Keir Starmer arrives in Liverpool as a man under siege, writes political editor David Maddox.
Tech giants could be handed hefty fines for cyberflashing in new rules
05:10
,
Maira Butt
Technology Secretary Liz Kendall is expected to announce cyberflashing as a priority offence under the Online Safety Act on Monday.
Ms Kendall will order firms to detect and remove unsolicited explicit images being sent online, in her speech at the Labour conference on Monday.
Firms that fail to comply could be fined up to 10 per cent of qualifying global revenue and see their services blocked across the UK.
The new policy plans to place extra duties on firms to protect users from seeing unsolicited nude images or videos.
She will say: “Keeping children safe online is non-negotiable... So platforms will be required – by law – to detect and remove this material. Because what is illegal offline, must be illegal online.”
Cyberflashing became a criminal offence in England and Wales in January 2024.
Labour to fund skills centre in Glasgow
05:02
,
Alisha Rahaman Sarkar
The UK government is to fund a skills centre to support shipbuilding in Scotland, with defence secretary John Healey accusing SNP ministers of failing to back the sector.
Mr Healey will use his speech to the Labour conference in Liverpool today to confirm £2.5m is being made available for the specialist welding skills centre on the Clyde in Glasgow.
The UK government has worked with Scottish Labour and Rolls-Royce to save the £11m Welding Development Facility.
It is hoped the centre will train the next generation of shipbuilders, with the funding coming after the UK government signed a £10 billion deal which will see Type 26 frigates for Norway built on the Clyde.
The UK government stepped in amid Labour concerns that the SNP's "anti-defence stance" was putting the creation of the welding skills centre in jeopardy.
Mr Healey said: "Labour is proud of Scotland's maritime heritage, and we are taking action to ensure its success long into the future."Where the SNP won't back Scottish industry, young people or our national security, Labour will step in.
"With our record defence investment, and our record export deals, Labour is making Scotland a shipbuilding superpower once again.
"We'll deliver good, well-paid jobs and opportunities across the Clyde, Rosyth, Methil and beyond."
David Lammy to announce expansion of 'intensive supervision courts' to tackle reoffending
04:40
,
Maira Butt
Justice Secretary David Lammy will promise “smarter justice” as he announces new plans to expand sentences aimed at tackling the root causes of crime at Labour’s annual conference on Monday.
The expansion of “intensive supervision courts” will see criminals with a history of repeated short sentences, substance abuse, or other complex needs brought back before the same judge to monitor their progress.
The initiative aims to in addressing the causes of criminal offending.
Long-term unemployed youth will be guaranteed work or be stripped of benefits
04:20
,
Maira Butt
Young people considered long-term unemployed, will be guaranteed paid work and could face benefits cuts if they refuse, Chancellor Rachel Reeves is expected to announce at the Labour conference on Monday.
Ms Reeves is expected to say: “We won’t leave a generation of young people to languish without prospects – denied the dignity, the security and the ladders of opportunity that good work provides.”
One in eight 16 to 24-year-olds are currently not in education, work, or training.
Palestine Action protesters arrested outside Labour conference
04:06
,
Maira Butt
Watch: Starmer brands Reform UK's indefinite leave to remain plan 'racist'
03:11
,
Maira Butt
Analysis: Starmer is in fighting mood
02:16
,
Maira Butt
The Independent’s political editor David Maddox reports:
Keir Starmer’s interview with Laura Kuenssberg on the BBC this morning shows that he is in fighting mood as he enters a crucial Labour conference.
“I just need the space to do what I need to do,” he pleads as he is pressed on calls for Andy Burnham to replace him.
“We are in the fight of our lives on who we are as a country we need to be in that fight and not naval gazing.”
It is a message to his critics in Labour and the unions who are getting increasingly concerned about the distant lead Reform currently hold.
But this will be the theme of this conference building to Starmer’s big speech on Tuesday. At that point he needs to persuade an anxious party that he is the right man to lead them in this fight.
Watch: Next election will be 'battle for soul of this country' Starmer says as poll finds Farage on course for No 10
01:02
,
Maira Butt
Why Starmer launched his attack on ‘racist’ Farage
Monday 29 September 2025 00:13
,
Maira Butt
After a disappointing first 14 months in Downing Street, Sir Keir Starmer is trying to revive his fortunes at this week’s Labour conference with a similar tactic.
In describing Nigel Farage and Reform as “the enemy” and “racists” who would “rip Britain apart” he has deliberately raised the political temperature.
Simon Walters reports:
Mahmood launches immigration crackdown as she overhauls main route to gain British citizenship
Sunday 28 September 2025 23:41
,
Maira Butt
Shabana Mahmood is set to announce a major crackdown on migration through a radical overhaul of the main route for immigrants gaining British citizenship in the UK.
Under tougher measures set to be unveiled by the home secretary, migrants who want to remain in the UK will have to learn English to a high standard, have a clean criminal record and volunteer in their community to be eligible for indefinite leave to remain. They will also have to be working, paying national insurance and not be claiming benefits under the proposed changes.
Millie Cooke reports:
Watch: Starmer denies that he put land bought for parents into trust
Sunday 28 September 2025 23:16
,
Maira Butt
More than half of Labour want new leader at next election
Sunday 28 September 2025 22:44
,
Maira Butt
More than half of Labour members do not want Keir Starmer to lead the party at the next election, according to the results of a Labour List survey conducted by Survation and shared with Sky News.
The results revealed that 53 per cent believe the party needs a new leader, and 65 per cent said the prime minister was headed in the wrong direction. Only a quarter believed Mr Starmer was handling the party well.
Treasury Minister faces backlash as he calls Lib Dem leader Ed Davey 'fat bloke in a wetsuit'
Sunday 28 September 2025 22:08
,
Maira Butt
“What Britain needs to tackle Farage is a vision,” said Torsten Bell on Sunday.
“And the vision is not a fat bloke in a wetsuit, which the Lib Dems have got to offer.”
The MP faced backlash on X/Twitter as social media users called the comments “cheap and disgraceful”.
WATCH: Treasury Minister Torsten Bell calls Ed Davey a "fat bloke in a wetsuit" pic.twitter.com/VloG67zHI7
— Politics UK (@PolitlcsUK) September 28, 2025
Consolation for Starmer as his MPs secure a late equaliser against Westminster’s journalists
Sunday 28 September 2025 21:15
,
Maira Butt
For many Labour MPs, this year’s conference is one they would not have minded missing.
The party is sitting far behind Nigel Farage’s Reform UK in the polls and their leader is more unpopular than ever.
So it will have been a welcome break from an otherwise somber gathering in Liverpool to play in the traditional journalists v MPs football game.
The Independent’s Political Correspondent Archie Mitchell reports:
‘No to Digital ID’ protests held near Labour Party conference in Liverpool
Sunday 28 September 2025 20:45
,
Maira Butt
Protesters gathered outside the Labour Party conference in Liverpool on Sunday (28 September) to oppose plans for a new national digital ID card.
Demonstrators carried banners reading “No to digital ID”, as they warned the scheme could pave the way for surveillance and the exclusion of vulnerable groups. The protest remained peaceful under police watch.
Camille Chorley reports:
Ed Miliband calls Elon Musk 'dangerous' and accuses him of baiting UK into 'US-style culture war' over climate
Sunday 28 September 2025 20:35
,
Maira Butt
Energy Secretary and former Labour leader Ed Miliband has hit out at Tesla billionaire Elon Musk at a Labour conference fringe event on Sunday.
“He called for the overthrow of our government. He incited violence on our streets,” he said. “His platform, X, promotes disinformation.”
He continued: “He is a dangerous person, definitely.”
Mr Miliband added that most Britons “really don’t like Elon Musk, they don’t like people coming and saying ‘we should overthrow the government’ and whatever other crap he says.”
He accused Musk of baiting the UK into a “US-style culture war” over climate.
