Jeremy Hunt Leaves Possibility Open for Benefit Cuts in Upcoming Autumn Statement
UK Chancellor Jeremy Hunt's Benefit Adjustment Stance Ahead of Economic Statement
Chancellor Jeremy Hunt has left open the possibility of adjusting the traditional method of increasing benefits, sparking speculations about future changes in welfare policy. Benefits in the UK are typically adjusted or "uprated" each April based on the inflation rate from the previous September.
Recent reports from Bloomberg News suggest that Hunt is contemplating using October's inflation rate for benefit increases, a shift that could reduce the annual increase to 4.6% compared to the potential 6.7%.
Uncertainty Surrounds Benefit Uprating
In an interview with the BBC's Sunday with Laura Kuenssberg, Hunt avoided making definitive statements about sticking to the established method of benefit increases. "I am not going to say this morning what I going to announce to parliament on Wednesday," he commented, maintaining a veil of mystery over the government's plans.
This discussion arises as the chancellor prepares for the upcoming Autumn Statement, a crucial financial overview before next year's general election. It's suggested that benefit adjustments aren't the only potential changes, as Hunt may also consider tax implications, such as cuts to inheritance tax, income tax, and national insurance.
Labour's Take on Benefit Increases
Addressing the potential changes, Rachel Reeves, the shadow chancellor from the Labour party, ensures that Labour would adhere to convention. "In government I will use the inflation rate that is traditional, the September inflation," she firmly stated. Reeves warned against variable approaches to inflation, which could lead to "the gradual erosion of people’s incomes."
The proposal to use October's rate could see a £3 billion reduction in spending on working-age benefits, as per the Institute for Fiscal Studies (IFS). This would signal a significant decrease in financial support for approximately 8 million households dependent on means-tested or disability benefits.
The IFS expressed concerns that the real value of benefits could not recover to their pre-pandemic level without further policy intervention. Additionally, the Resolution Foundation highlighted the already severe effect of past benefit cuts by the Conservatives. "The poorest fifth are around £2,700 a year worse off as a result. And that’s just the average," noted Torsten Bell, director of the think-tank, shedding light on the struggles of numerous families.
Oliver Balche is a UK-based journalist specializing in breaking entertainment news. Known for his ability to deliver up-to-the-minute reports on events across the UK, Balche has crafted a reputation for accuracy, timeliness, and an unwavering commitment to journalistic integrity. His expertise spans all spectrums of the entertainment industry, making him a respected and reliable source of the latest happenings.
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