Dig Deep Comrades - Taxes Aren't High Enough Yet!

 

You can treble their salary, yet not one extra patient will be treated nor will the waiting list shrink because of Labour's largesse!

Labour’s Tax Hikes: The Hidden Culprit Behind Soaring Food Costs

 

Since the Labour government, led by Chancellor Rachel Reeves, rolled out its economic policies in late 2024, the UK has witnessed a troubling surge in food prices that’s hitting households hard. While Labour promised to make work pay and stabilise the economy, their tax increases and minimum wage hikes are being widely blamed for driving up the cost of living—particularly when it comes to the price of food. Let’s break down the numbers and examine how these policies are affecting everyday Brits.

 

In her October 2024 Budget, Reeves announced a 6.7% rise in the National Living Wage, pushing it from £11.44 to £12.21 an hour starting April 2025. Alongside this, she increased National Insurance Contributions (NICs) for employers, a move dubbed by critics as a “tax raid on businesses.” The intent was to boost workers’ incomes and fund public services, but the ripple effects have been far less rosy. According to the British Retail Consortium (BRC-NIQ) Shop Price Index, food inflation has now climbed to 2.8% in May 2025, up from 2.6% in April. Fresh food inflation has seen an even sharper rise, jumping to 2.4% compared to 1.8% the previous month. This marks the fourth consecutive month of rising food prices, a trend that industry experts and businesses are directly linking to Labour’s policies.

 

The mechanism here is straightforward but brutal. The hike in the minimum wage, while a win for low-paid workers on paper, has significantly increased operating costs for businesses, especially in labour-intensive sectors like retail, hospitality, and food production. On top of that, the higher NICs have added further pressure, with some estimates suggesting that the combined impact of these measures has raised the cost of hiring by as much as 5-7% in real terms for 2025–26. Businesses, unable to absorb these costs amid already tight margins, have little choice but to pass them on to consumers. As a result, the price of a weekly shop is climbing steadily, with fresh goods like meat, vegetables, and dairy bearing the brunt of the increases.

 

The economic backdrop only makes things worse. Inflation, which had been expected to stabilise, bounced back to 3.5% in April 2025, driven in part by these same tax and wage policies. The Office for Budget Responsibility (OBR) had already warned in March 2025 that higher wage growth and elevated input costs—exacerbated by Labour’s measures—would push inflation to a quarterly peak of 3.7% by mid-2025. This isn’t just a blip; it’s a sustained trend that’s eroding purchasing power. Posts on X reflect growing public frustration, with many users pointing fingers at Reeves’ “reckless tax raid” for hammering businesses and, by extension, household budgets.

 

Reeves has claimed the economy is “beginning to turn a corner,” pointing to stronger-than-expected GDP growth of 0.7% in early 2025, driven by consumer spending and business investment. But this optimism feels hollow when juxtaposed against the reality of rising costs. Consumer spending might be up, but so is borrowing—government borrowing hit £20.2 billion in April 2025 alone, raising fears of further tax rises later this year. The International Monetary Fund (IMF) has even urged Reeves to loosen her fiscal rules to avoid emergency spending cuts, a sign that the government’s financial strategy is on shaky ground.

 

What’s particularly galling is how predictable this was. Businesses warned last year that higher NICs and wage mandates would force them to raise prices. A survey from March 2025 found that 56% of firms with ten or more staff were planning to offset these costs by increasing prices, and we’re now seeing that play out in supermarket aisles. The Labour government’s narrative of “making work pay” is cold comfort to families who are paying 2.4% more for fresh food than they were a year ago, with no sign of relief in sight.

 

Critically, this approach ignores the broader economic dynamics at play. The cost of living crisis, already a defining issue for Labour as noted by No. 10 strategists, is being exacerbated by these policies, not alleviated. While the minimum wage increase might put a few extra pounds in workers’ pockets, the corresponding rise in food prices—coupled with inflationary pressures on rents and energy—means that real disposable income is shrinking for many. This is the spectre of stagflation rearing its head: rising prices without corresponding economic growth or wage gains that actually keep up.

 

Reeves and the Labour government need to take a hard look at the unintended consequences of their policies. Championing workers’

Starmer’s Chagos Surrender: A Betrayal of Britain and Its People

 

In a move that reeks of incompetence, betrayal, and a shocking disregard for Britain’s national interest, Prime Minister Keir Starmer has pushed through a deal to cede sovereignty of the Chagos Islands to Mauritius—a decision that will cost British taxpayers an eye-watering £30 billion over decades, compromise national security, and ignore the wishes of the Chagossian people. This deal, cloaked in the guise of moral necessity, is nothing short of a scandal, orchestrated by a cabal of lawyers with deep ties to Starmer himself, and it stands as one of the most egregious missteps of his fledgling premiership.

An Unnecessary Surrender

Starmer has claimed that handing over the Chagos Islands, including the strategically vital Diego Garcia military base, was necessary to comply with international law and secure the future of the UK-US military partnership. Yet, this assertion crumbles under scrutiny. The UK has maintained sovereignty over the Chagos Islands since 1965, when they were detached from Mauritius prior to its independence. For decades, this arrangement has worked without issue, with Diego Garcia serving as a critical hub for Western military operations in the Indian Ocean. The International Court of Justice’s 2019 advisory opinion, often cited by Starmer’s government, is non-binding and does not mandate this surrender. Legal experts, including those outside Starmer’s inner circle, have argued that the UK could have continued to assert its sovereignty while negotiating alternative arrangements, such as a lease agreement, without relinquishing control entirely. 

 

The decision to cave was not driven by legal necessity but by political expediency and Starmer’s desire to signal Britain’s retreat from its global responsibilities. By rushing to finalise this deal, Starmer has weakened Britain’s strategic position and handed Mauritius—a nation with growing ties to China—a geopolitical gift it neither earned nor deserved.

The Staggering Cost to Taxpayers

The financial implications of this deal are nothing short of scandalous. Estimates suggest that the UK will pay Mauritius between £9 billion and £30 billion over the coming decades, including annual lease payments for Diego Garcia and potential “reparations” for the Chagossian people. This figure dwarfs the £1.4 billion saved by Starmer’s controversial decision to scrap the winter fuel allowance for millions of British pensioners—a move that has already sparked outrage for endangering the health and finances of the elderly. To put this in perspective, the cost of the Chagos deal could fund the reinstatement of the winter fuel allowance for years, with billions left over to protect family farms from Labour’s punitive inheritance tax hikes. 

 

Starmer’s priorities are baffling. At a time when working families face rising taxes and pensioners shiver through winter, his government is funnelling billions to a foreign nation to lease back territory Britain already controlled. This is not leadership; it is fiscal recklessness.

The Chagossians’ Voice Ignored

Perhaps the most galling aspect of this deal is its complete disregard for the Chagossian people, who were forcibly displaced from the islands in the 1960s and 1970s to make way for the Diego Garcia base. The Chagossians have consistently expressed their desire to remain under British sovereignty, with many opposing transfer to Mauritius due to fears of marginalisation and neglect. Community leaders have voiced concerns that Mauritius, which has shown little interest in their welfare until now, will not prioritise their rights or repatriation. By ignoring these voices, Starmer has betrayed the very people he claims to champion, prioritising geopolitical posturing over human rights.

Security Implications: A Dangerous Precedent

The security implications of this deal are equally dire. The agreement requires the UK to notify Mauritius in advance of any military operations from Diego Garcia, a condition that could compromise operational secrecy and give Mauritius—and potentially its allies, including China—unprecedented insight into Western military activities. Diego Garcia is a linchpin of US-UK defence strategy, used for everything from counterterrorism operations to projecting power in the Indo-Pacific. Handing Mauritius a seat at the table risks undermining the base’s effectiveness and emboldening adversaries who seek to erode Western influence in the region.

 

The deal’s security flaws are compounded by Mauritius’s growing economic and diplomatic ties to China. Posts on X and various analyses have raised alarms about the potential for Chinese influence to creep into the Chagos Archipelago, placing a critical US-UK military asset in jeopardy. Starmer’s government has downplayed these concerns, but the naivety of trusting Mauritius to act as a neutral partner in a geopolitically sensitive region is staggering.

A Cabal of Activist Lawyers

At the heart of this deal lies a troubling network of legal insiders with deep ties to Starmer. Leading the Mauritian negotiating team is Philippe Sands, a prominent lawyer and long-time associate of Starmer, dating back to their days at the Bar. Sands has represented Mauritius in its legal campaign against the UK for years, and his involvement in securing this deal raises serious questions about conflicts of interest. Furthermore, the UK’s Attorney General, Lord Hermer, reportedly strengthened legal advice to push Starmer toward surrender, arguing that the UK risked breaching international law—a claim that conveniently aligned with Mauritius’s demands. This cosy circle of lawyers, with Starmer at its centre, has engineered a deal that serves Mauritius’s interests while undermining Britain’s. The stench of cronyism is inescapable.

A Deal Collapsing Under Scrutiny

The Chagos surrender has sparked fierce backlash, even within Starmer’s own cabinet. Reports indicate that some ministers are questioning the deal’s exorbitant cost, especially when juxtaposed against domestic austerity measures like the winter fuel allowance cut. On X, critics like Robert Jenrick and Andrew Neil have lambasted Starmer for his lack of transparency and the deal’s staggering financial burden. A judicial review, launched by the campaign to Save the Chagos, is now underway, signalling that this deal may not survive public and legal scrutiny.

A Betrayal of Britain’s Interests

Starmer’s Chagos surrender is a masterclass in political failure: a costly, unnecessary, and strategically disastrous decision driven by a clique of insiders and sold to the public under false pretences. It ignores the Chagossian people, jeopardises national security, and squanders billions that could be better spent on Britain’s struggling pensioners and farmers. This is not the action of a leader committed to Britain’s strength or sovereignty but of one willing to sell out the nation’s interests for a fleeting moment of international applause. The British people deserve better—they deserve a government that fights for them, not one that gives away their assets to appease foreign powers and old friends.

Starmer’s Damp Squid Winter Fuel Allowance Faux U-Turn

 

In a move that reeks of political desperation rather than principled leadership, Prime Minister Keir Starmer has announced a partial U-turn on the Labour government’s deeply unpopular decision to slash winter fuel payments for millions of pensioners. The announcement, delivered during Prime Minister’s Questions on May 21, 2025, was as vague as it was belated, offering no concrete details on what changes will be made, when they will take effect, or who will benefit. This half-hearted gesture not only fails to address the damage caused by Labour’s initial policy blunder but also exacerbates an already dire situation, further eroding Starmer’s crumbling authority and exposing the government’s inability to govern with coherence or conviction.

 

Let’s rewind. Last July, barely weeks into Labour’s tenure, Starmer’s government decided to means-test the winter fuel allowance, stripping millions of pensioners of a vital £300 payment designed to help them heat their homes during the colder months. The decision, justified as a necessary sacrifice to plug a supposed fiscal black hole left by the Conservatives, was met with immediate and ferocious backlash. Pensioners, already battered by the cost-of-living crisis, were left to choose between heating and eating, while Labour MPs, trade unions, and voters expressed outrage at what many saw as a betrayal of the elderly. The policy was not just economically shortsighted—older people living in energy-inefficient homes are particularly vulnerable to cold-related health issues, placing further strain on the NHS—it was politically toxic, contributing to Labour’s bruising losses in recent local elections.

 

Now, after months of stubbornly defending the cut, Starmer has blinked. But instead of a bold reversal or a clear plan to restore support, he has offered a masterclass in political fudge. During PMQs, he vaguely promised to “ensure that, as we go forward, more pensioners are eligible for winter fuel payments,” citing an improving economic picture as the enabler. Yet, he provided no specifics on the new eligibility criteria, no timeline for implementation, and no assurance that changes would even be in place before the coming winter. This lack of clarity has left pensioners in limbo, facing “uncertainty and anxiety” as charities like Independent Age have warned. For a policy that was already a lightning rod for criticism, Starmer’s refusal to commit to details only pours fuel on the fire.

 

This half-arsed U-turn is worse than no U-turn at all. By admitting the policy was a mistake without offering a concrete fix, Starmer has managed to alienate everyone: pensioners who still don’t know if they’ll receive help, Labour MPs who have been hung out to dry defending the original cut, and voters who see this as yet another sign of a government scrambling to save face. The SNP’s Westminster leader, Stephen Flynn, put it bluntly: “Which pensioner will ever trust Keir Starmer again over the winter fuel payment, given his constant shift in position?” Scotland’s First Minister John Swinney echoed this, arguing that no amount of backtracking can erase the fact that Labour removed the payment in the first place.

 

Starmer’s indecision also lays bare internal divisions within Labour. The announcement, made personally by the Prime Minister rather than Chancellor Rachel Reeves, who initially championed the cut, suggests a rift at the top. Allies of Reeves insist she and Starmer are “united,” but the optics of Starmer seizing control of the issue fuel speculation about her weakened position. Meanwhile, Deputy Prime Minister Angela Rayner’s leaked memo pushing for tax hikes to avoid further spending cuts hints at deeper tensions over Labour’s fiscal strategy. With over 100 Labour MPs already rebelling over proposed welfare cuts, including to disability payments, Starmer’s leadership is looking increasingly shaky.

 

The political fallout is already evident. Conservative leader Kemi Badenoch, who has relentlessly campaigned against the winter fuel cut, seized the opportunity to brand Starmer “desperate,” while posts on X from the Conservative Party crowed that their pressure forced Labour’s hand. Even Nigel Farage has been credited with a “victory” for amplifying public anger, underscoring how Starmer’s misstep has handed ammunition to his opponents. Labour’s own supporters are defecting—polls suggest they’re seven times more likely to switch to the Lib Dems or Greens than to Reform UK, a damning indictment of Starmer’s inability to hold the coalition that swept him to power.

 

Worst of all, this U-turn does nothing to address the human cost of Labour’s original decision. Pensioners, many of whom live in poorly insulated homes and face soaring energy bills, were already struggling last winter. The cut to the winter fuel allowance was described by critics like Diane Abbott as Labour’s “poll tax moment” for its visceral impact on voters. Starmer’s vague promise of future relief offers no immediate help, leaving millions of elderly people facing another winter of hardship. Charities have warned that without clear eligibility criteria and a firm timeline, the uncertainty will only deepen the distress.

 

Starmer’s defenders might argue that the improving economy—growth of 0.7% in Q1 2025—allows for this partial reversal. But this ignores the fact that the cut was a choice, not a necessity, and one that has already inflicted irreversible damage on Labour’s reputation. The Spectator rightly called the U-turn a “big mistake,” arguing it signals a lack of backbone and undermines Starmer’s authority to push through other tough decisions. By caving to pressure without a clear plan, he’s shown he’s more concerned with political survival than principled governance.

 

In the end, Starmer’s winter fuel allowance debacle is a case study in how to turn a bad situation worse. His initial decision to cut the payment was callous and poorly judged; his half-baked U-turn is spineless and incoherent. With no details on criteria, timing, or scope, pensioners are left in the cold—literally and figuratively—while Labour’s internal fractures and electoral vulnerabilities grow. If Starmer thought this retreat would buy him breathing room, he’s sorely mistaken. It’s a stark reminder that leadership requires more than vague promises—it demands clarity, courage, and conviction. On all three counts, Starmer has been found wanting.

Rachelbot Malfunctions

 

Rachel Reeves’ voice appears to be rising in line with inflation 😅 pic.twitter.com/kQJVZVATrM

— Calgie (@christiancalgie) May 21, 2025

Is History About To Repeat Itself? - #Arseongate

 

#ArseonGate Latest

 

The Met says Romanian national Stanislav Carpiuc, 26 has been charged in relation to fires which damaged properties and a car linked to Keir Starmer.

— Guido Fawkes (@GuidoFawkes) May 20, 2025

Albania Says No To Starmer's "Rwanda Lite" Plan

 

NEW: PM Edi Rama says NO return hub for Britain in Albania

Asked if he would replicate the deal they have with Italy with Starmer, its a no from him"

"I have said from the outset, it is is a model takes its time to be tested and if it works it can be replicated but NOT in…

— Harry Cole (@MrHarryCole) May 15, 2025

Starmer’s Immigration Crackdown: Tough Talk, Toothless Policy, and the ECHR Anchor

 

Starmer took to the podium in Downing Street today, brandishing a white paper and a barrage of populist rhetoric, vowing to end Britain’s “failed experiment in open borders” and slash net migration. With net migration at 728,000 in the year to June 2024, Starmer promised a “controlled, selective, and fair” immigration system, claiming it would prevent the UK from becoming an “island of strangers.” Yet, beneath the bluster, his proposals are a masterclass in performative politics—long on promises, short on substance, and fatally undermined by his refusal to confront the European Convention on Human Rights (ECHR) or outline concrete measures to stop and deport illegal migrants. Starmer’s tough talk is a hollow attempt to counter the surging Reform UK, but it’s clear his actions won’t match the rhetoric.

The ECHR: Starmer’s Untouchable Sacred Cow

At the heart of Starmer’s failure lies his unwavering commitment to the ECHR, a treaty that has repeatedly thwarted Britain’s efforts to control its borders. During his press conference, when asked if the UK should “disentangle” itself from the ECHR, Starmer flatly rejected the idea, arguing that compliance with international law is necessary for international law enforcement agreements. This stance is a death knell for any serious immigration reform. The ECHR, particularly Articles 3 (freedom from torture) and 8 (right to family life), has been exploited by foreign criminals and illegal migrants to block deportations, often on flimsy grounds. For example, a Palestinian family of six was granted asylum through a Ukrainian refugee scheme, and an Iraqi migrant who arrived as a minor was allowed to stay because it wasn’t his “decision” to come to the UK.

 

Shadow Home Secretary Chris Philp warned that Starmer’s plans to prevent foreign sex offenders from claiming asylum are “deeply dishonest” because Article 3 of the ECHR supersedes other conventions, allowing criminals to dodge deportation. Former adviser Rajiv Shah echoed this, noting that Article 3’s absolute interpretation renders Starmer’s reforms “totally ineffective.” Nigel Farage, leader of Reform UK, was blunt: “This government will not do what it takes to control our borders. Only Reform UK will leave the ECHR and deport illegal migrants.” Starmer’s refusal to even consider exiting the ECHR—unlike Denmark, which tried (and failed) to restrict its scope—ensures that judges will continue to prioritise migrant rights over public safety.

No Plan to Stop or Deport Illegal Migrants

Starmer’s white paper is deafeningly silent on the critical issue of illegal migration, particularly the 30,000 small-boat crossings since Labour took office in July 2024. His speech focused heavily on legal migration—tweaking visa rules, raising English language requirements, and extending the wait for citizenship from five to ten years—but offered no concrete strategy to halt the Channel crisis or deport those with no right to stay. This omission is glaring, given Starmer’s earlier pledge to “smash” people-smuggling gangs, a promise that has yielded little beyond summits and soundbites.

 

In March 2025, Starmer defended human rights lawyers who thwart deportations, arguing that blaming them would “break down” the system. Yet, he’s now promising to curb judges’ powers to block deportations under the ECHR, claiming he’ll “inject common sense” into the system. This is a contradiction wrapped in a fantasy—“common sense” isn’t a legal term, and Starmer’s track record suggests he’s more comfortable defending the status quo than dismantling it. In 2020, he signed a letter opposing the deportation of foreign criminals to Jamaica, a fact he dodged when questioned today. Kemi Badenoch, Tory leader, seized on this hypocrisy: “Keir Starmer once called all immigration laws racist. So why would anyone believe he actually wants to bring immigration down?”

 

The numbers tell the story of Labour’s failure. Since July 2024, 6,642 migrants crossed the Channel in 2025 alone, surpassing the same period in 2024. Starmer’s much-touted 24,103 “returns” between July 2024 and March 2025 include voluntary and asylum-related returns, not just enforced deportations, inflating the figures to mask inaction. His plan to tighten legislation around ECHR loopholes, such as those allowing “exceptional circumstances” to block deportations, lacks detail and teeth. Without leaving the ECHR or radically rewriting domestic law—an unlikely move given Labour’s left flank—Starmer’s reforms are destined to be symbolic.

Performative Policies for a Reform UK Problem

Starmer’s crackdown reeks of political expediency, rushed out to counter Reform UK’s surge after heavy Labour losses in May’s local elections. The white paper’s measures—banning care homes from recruiting overseas workers, requiring English proficiency, and prioritising migrants who “contribute” (e.g., pay taxes or volunteer)—are designed to sound tough but dodge the root issues. The Home Office estimates these changes might reduce inflows by 100,000 annually, but this is speculative and fails to address illegal migration, which Farage has skilfully conflated with legal routes to galvanise voters.

 

Refugee charities like Care4Calais have slammed Starmer’s rhetoric, particularly his “island of strangers” phrase, as “dangerous” and fuelling far-right narratives. Meanwhile, the SNP called the care home ban a “devastating attack” on Scotland’s services, highlighting the economic fallout of Labour’s posturing. Even business leaders, like Neil Carberry of the Recruitment and Employment Confederation, warned that Starmer’s intervention “will spark alarm among bosses,” as sectors reliant on migrant workers face disruption.

Rhetoric Without Resolve

Starmer’s immigration overhaul is a classic case of talking the talk without walking the walk. His refusal to exit the ECHR shackles the UK to a legal framework that prioritises migrant rights over national sovereignty. His failure to outline a robust plan to stop small-boat crossings or deport illegal migrants betrays a lack of seriousness, despite his claims of “anger” at the crisis. The white paper’s focus on legal migration tweaks, while ignoring the Channel chaos, is a misdirection aimed at appeasing voters spooked by Reform UK’s rise.

 

As Farage taunted on X, “Starmer is making promises he can’t keep.” The Prime Minister’s history—opposing deportation flights, defending human rights lawyers, and once labelling immigration laws “racist”—undercuts his newfound hawkishness. Without the courage to confront the ECHR or prioritise enforcement over optics, Starmer’s crackdown is a paper tiger, destined to crumble under the weight of its own contradictions. Voters, as The Sun warned, “will be watching,” and any “backsliding” will be punished at the ballot box. For now, Starmer’s tough words are just that—words, unbacked by the action needed to secure Britain’s borders.

Rachel Reeves’ Tax Rises: A Reckless Gamble Wrecking Britain’s Economy

 

In a damning indictment of Chancellor Rachel Reeves’ economic stewardship, the National Institute for Economic and Social Research (NIESR), the UK’s oldest and most respected research institute, has laid bare the catastrophic consequences of her £40bn tax raid, with the hike in employers’ National Insurance Contributions (NICs) singled out as a particularly egregious misstep. The NIESR’s overnight report on the UK’s domestic economic conditions paints a grim picture, warning that Reeves’ policies are not just hampering growth but are “playing a more dominant role” in the nation’s economic malaise than external pressures like Donald Trump’s tariff threats. Far from delivering the promised “national renewal,” Reeves has plunged the UK into a precarious position, with businesses battered, workers squeezed, and the economy teetering on the edge of a self-inflicted crisis.

 

The centrepiece of Reeves’ economic strategy—or lack thereof—was a £25bn increase in employers’ NICs, a policy that NIESR excoriates for its devastating impact. By raising the NIC rate to 15% and lowering the threshold at which businesses start paying, Reeves has effectively slapped a tax on jobs at a time when economic confidence is already wafer-thin. The report is unequivocal: this hike “leaves the budget—and the UK economy as a whole—in a risky and vulnerable position.” The decision to pile costs onto businesses, particularly in low-wage sectors like hospitality and retail, is not just shortsighted; it’s economic vandalism. The Office for Budget Responsibility (OBR) estimates the NICs increase will equate to losing 50,000 workers from the economy, as firms scale back hiring and hours to cope with the added burden. Real wages are projected to stagnate for two years, with 76% of the NICs cost passed onto workers through suppressed pay rises and higher prices. So much for Labour’s pledge to put “pounds in people’s pockets.”

 

NIESR’s analysis cuts through Reeves’ rhetoric like a scalpel. While she touts investment in public services as the path to growth, the institute warns that her tax rises are actively undermining that goal. The report slashes its 2025 growth forecast to 1.2% from 1.5%, with projections for subsequent years similarly downgraded. By 2029/30, NIESR estimates a £57bn shortfall in public finances—equivalent to $76bn—driven by weaker growth and higher borrowing costs. This isn’t just a blip; it’s a structural failure. Reeves’ budget, hailed as a “gamble” by the Institute for Fiscal Studies, is now exposed as a reckless bet that’s backfired spectacularly. The OBR’s earlier warnings that growth would dip to 1.5% by 2028, down from a pre-budget forecast of 1.7%, are now compounded by NIESR’s even bleaker outlook. Reeves’ claim that her policies would boost long-term growth by 1.5% has been debunked as little more than wishful thinking, with the OBR noting any benefits won’t materialise until the 2030s—long after voters have felt the pain.

 

What makes Reeves’ approach so galling is its contradiction of Labour’s own manifesto. She campaigned on growth, promising to shield working people from tax hikes. Yet, by targeting employers’ NICs, she’s indirectly taxed workers through lower wages and higher costs. The Resolution Foundation has called this “a tax on working people,” and the IFS notes it disproportionately hits larger firms employing low-wage workers, potentially choking off minimum-wage jobs. Reeves’ sleight-of-hand—claiming she’s kept her promise by not raising employee NICs—fools no one. As NIESR points out, the economic damage is compounded by a 6.7% rise in the national living wage, which, while well-intentioned, adds further pressure on businesses already reeling from the NICs hike. Inflation, forecast to hit 3.3% in 2025 and 3.1% in 2026, is being fueled by these policies, forcing the Bank of England to keep interest rates higher—potentially at 4.25% with only two quarter-point cuts expected next year. For households, this means pricier mortgages and less disposable income, with a typical £200,000 mortgage costing an extra £360 annually.

 

The NIESR report also skewers Reeves for her fiscal irresponsibility. Her budget left just £9.9bn of fiscal headroom, a buffer now entirely eroded, leaving no room to absorb economic shocks. With global trade tensions escalating—Trump’s proposed 21% tariffs on UK goods could shave 0.4% off GDP—the UK is uniquely exposed. Yet, as NIESR’s Benjamin Caswell notes, “domestic factors” like the NICs hike are doing more damage than external threats. Reeves’ refusal to acknowledge this is either willful ignorance or political cowardice. Her insistence that no further tax rises are needed, reiterated ahead of the March 26, 2025, Spring Statement, strains credulity. Economists across the board, from NIESR to Capital Economics, warn that without spending cuts or more taxes, Reeves risks breaching her own fiscal rules. The £10bn she claimed as a safety net has vanished, and with it, any pretence of economic competence.

 

Businesses are sounding the alarm, and they’re not being heard. The British Institute of Innkeeping estimates 80% of pubs are now unprofitable, with 75% cutting staff hours and a third facing redundancies. GP surgeries, care homes, and charities are similarly blindsided, with Reeves seemingly unaware of the collateral damage. The Institute of Directors calls the budget a “blow” to investment, and firms are already curbing hiring and expansion. The London stock market, down 3% in December 2024, reflects investor fears of a flatlining economy. Meanwhile, Reeves’ much-vaunted infrastructure plans—1.5 million homes, a Heathrow third runway, an Oxford-Cambridge Growth Corridor—won’t deliver meaningful growth for years, leaving the economy exposed in the short term.

 

Reeves’ defenders might point to the International Monetary Fund’s tepid endorsement of her spending increases, but even that comes with caveats, overshadowed by the Resolution Foundation’s stark warning that the UK remains a “stagnation nation.” Her claim to have “fixed the foundations” is risible when those foundations are crumbling under the weight of her own policies. The Telegraph’s report of a “short-term sugar rush” from public spending, fading by 2027, underscores the lack of a coherent long-term strategy. Reeves’ budget is not a plan for growth; it’s a recipe for unemployment, insolvencies, and economic decline.

 

The chancellor’s hubris is matched only by her hypocrisy. She lambasted the Conservatives for leaving a £22bn “black hole” but has dug a deeper one herself. Her refusal to reverse course, even as evidence mounts, suggests a politician more concerned with political expediency than economic reality. NIESR’s warning that “now is not the best time to take a gamble” should haunt Reeves. She’s not just gambling with numbers—she’s gambling with livelihoods, businesses, and Britain’s future. If she continues on this path, the verdict of history will be unforgiving: Rachel Reeves didn’t just fail to deliver growth; she actively destroyed it.