International Socialist League
Who is hardest hit by Chancellor Rachel Reeves’ budget? Certainly not the wealthy or big corporations. What is overlooked? Vital areas like adult and social care, mental health, benefit caps, child poverty, and social housing, and the over 4 million children in poverty.
The Joseph Rowntree Foundation warns that living standards will plummet again by the end of this parliament, disproportionately affecting those on the lowest incomes. The poorest, low waged and the most vulnerable have benefited nothing.
Labour claim economic growth will improve lives, but projections suggest growth will barely reach 2%, leaving families to face continuing hardship and misery due to their aversion to properly taxing the wealthy elite, or to pursue public ownership of key industries and introduce socialist policies.
Unless the NHS is fully funded and the profit motive removed from healthcare – nationalising big pharmaceutical companies, private health providers and medical supply companies – patients will not feel any benefit from the £22.6 billion injection over the next two years.
The Tories catered to the wealthy, and while Labour feigns surprise at the £20 billion deficit the last government created, their new policies will not fix the economy. Labour are manipulating definitions of national debt to fit their fiscal rules, falsely projecting a surplus in three years.
The announced investments merely prevent a service collapse – in some cases. Labour’s collaboration with private markets will divert public funds into private profits and the burden of increased employers National Insurance Contributions (NIC) will inevitably fall on workers. By 2026-27, the Office for Budget Responsibility estimates that 76% of these NIC increases will reduce real wages and lead to higher prices thus lowering living standards.
The government aims to cut benefits by £3bn. As social benefits, including Universal Credit and Child Benefit, will rise by a meagre 1.7% from April 2025, this means a cut in real terms. Changes to out-of-work benefits means forcing over 450,000 disabled and chronically ill individuals back into work as they face deeper poverty. People receiving sickness benefits therefore face a fearful future at a time when almost two thirds of those experiencing destitution have a long-term health condition. At the same time the continued restriction on carer’s allowance punishes many for supporting their family members.
The budget pledged £5 billion for house building, but only £500 million is earmarked for ‘affordable’ options, with social landlords gaining the right to raise rents above inflation. The changes to social security will not substantially lower hardship. The Local Housing Allowance remains frozen, exacerbating housing insecurity as private rents soar and become further out of step with local rent levels.
The freeze on the income tax threshold will drag 400,000 workers into paying income tax for the first time, as 600,000 face an even higher tax burden.
Labour’s budget, marked by its pro-business stance, fails to address the deep-rooted issues of poverty and inequality. The political reality is clear: Labour serves the elite while the working class continue to suffer with rising costs and stagnating wages, the budget offers no significant solutions to the social crises we face.
The State of Britain
Starmer has adopted austerity measures reminiscent of the past, focusing on attracting private investment at the expense of safety and public welfare with promises on workers’ rights neglected.
Public bus services remain largely in private hands although public opinion remains in favour of a nationalised public transport system,. While Labour’s plans to increase bus fares by 50% will further affect low-wage workers. Most of the rail passenger services are to be taken back into state ownership with those remaining in private hands facing greater regulation! However, this excludes the lucrative freight and rolling stock (ROSCO) companies, which means the private sector will continue to profit from publicly funded infrastructure.
Today, three ROSCOs control 87% of the market and own 15,200 vehicles, with all the companies foreign-owned and registered in Luxembourg. ROSCOs paid dividends of £409.7m in 2022-23 with a profit margin of 41.6%. Over the last ten years the cumulative dividend was £2bn (£2.7bn between 2012 and 2020) – with a dividend typically being 100% of the pre-tax profits thus escaping UK tax.
Labours’ ties to big business hinders any change on critical issues like the precarious working, zero-hour contracts and anti-trade union laws.
In 2023 Angela Rayner, as deputy leader, gave a ‘cast iron’ promise to ban zero-hours contracts and told the TUC they would seek to repeal anti-strike laws within 100 days of entering government – both remain unchanged.
The workers’ rights at work bill, concerning the ban on the million zero-hour contracts in the UK, includes eight clauses removing that right, for example, if the extra wage cost might damage the business and affect quality or customer service staff performance. Zero hours will not be banned – only ‘exploitative’ zero hours contracts. But who determines ‘exploitative’ – the bosses or the workers?
Starmer has adopted Cameron’s ‘bonfire of regulations’ strategy to attract private investment. So, health and safety issues and concerns that led to tragedies such as Grenfell or resulted in death, injury and illness in workplaces, will continue to blight the lives the working class.
There is big private sector investment alongside public funding, such as the plan recently announced for £21 billions of public investment in carbon capture and storage alongside billions of pounds of private investment. Greenpeace say “Carbon capture technology is yet unproven in reducing emissions from fossil fuel use and industry at an affordable cost. And the promise of carbon capture and storage may even be encouraging continued fossil fuel use.” It is not yet proven to be deliverable or cost-effective at the level needed.
Labour continues to support the genocide by the Israeli state and its Zionist leadership (covered in the last issue of Socialist Voice). He refuses to condemn the targeted killing of medics and journalists, the deliberate destruction of hospitals and the bombing of civilian infrastructure. To this political monster, the mass slaughter of civilians in Gaza and Lebanon, is simply a result of the right of Israel to ‘defend’ itself.
Starmer also echoes the slogans of Nigel Farage and Boris Johnson, to take back control over immigration, targeting and exaggerating the ‘problem’ of benefit fraud at the same time ignoring the massive tax evasion by the rich, as we face a further period of austerity on behalf of the established social and political elite.
Wealth continues to be untouched by Reeves. Between 2011-2022, the King increased his annual profits by 42.6 per cent to £25.4 million. Over the same period, the estate’s wealth climbed by almost 50 per cent. The Sunday Times Rich List for 2024 – listed the King has having personal wealth of £600 million. Figures produced of the 350 richest individuals and families in Britain have a combined wealth of over three-quarters of a trillion pounds.
In 2023, Shell and BP made £22 billion in profit between them, aided by the huge increase in energy bills for most households. The water companies have racked up £60 billion of debt since privatisation in 1989, while hiking bills – not to pay for investment in infrastructure, as is obvious from the repeated pollution scandals, but to churn out £72 billions of profit in the same period!
Starmer’s rhetoric about serving the British working people is disingenuous, because he serves the ‘working’ people in the oil companies and big business but not the working class or oppressed people.
Labour ignores housing and many Crisis areas
With great bombast Reeves said the budget “will match the greatest economic moments in Labour history”, by maintaining the two-child benefit cap, cuts to pensioners’ winter fuel allowance whilst aiming to increase ‘defence’ 2.5% of GDP by the next election!
The sell-off of council houses has decimated council housing stock, with over 2 million council homes sold whilst there are more than a million households on the council waiting lists. According to New Economics Foundation (NEF) 41% of all council homes sold under the right to buy scheme are now being let on the private rental market.
Removing council houses in the 1980s has led to higher rents and high private housing costs, a result being an increasing number of homeless people including refugees are forced to live on the streets. Now at record levels, thousands of homeless families are trapped in debt and denied social housing with nearly 4,000 homeless households in England barred from applying for social housing because of debt.
Whilst Tory policies led to the housing crisis, Labour implementation made the crisis worse.
Universal Credit is below the poverty level, so any deductions are cruel, all benefits should provide sufficient support to allow those in need a dignified life.
The political questions are who rules? Bombastic Reeves and Labour or the obscenely rich? Who suffers? Are capitalists taxed to the hilt or left in luxury?
There is nothing in the budget to alleviate the social problems facing the working class. This is not a one-off bad budget, as it determines life for the majority for at least the next five years. As Labour pursue capitalist answers to capitalist problems, just like Conservative government, hardship and misery will increase for the working class and the wealthy will thrive.
How can workers and oppressed Fight
The need for a new workers party
The International Socialist League fights for a new workers’ party that unites trade unions and community forces, against capitalism and therefore the Labour party. We propose a ten-point programme for a genuine workers’ movement, focusing on workers’ rights, oppressions, climate action, and public ownership of essential services. Together, we can build a movement that prioritises the needs of working-class people and fights against oppression in all forms.
The fight against oppressions covers many issues inside our struggle for women’s rights and many others but also the right of self-determination that includes Palestine and Ukraine, both nations suffering from genocide and invasion. We oppose imperialist aims for Ukraine, we support the struggle of workers and youth to defend their country from the Russian invasion and fight the neo-liberalism of the USA, Britain and European Union.
ISL/Socialist Voice 10-point program for a Workers Party
1) Defend unions and workers’ rights to organise! For an independent workers’ party based on a democratic, fighting workers’ movement! No support for Tories, Lib Dems or Labour!
2) End all immigration controls! Safe and legal routes for all immigrants! No deportations
3) End racism! End violent policing! Reparations to all former enslaved and colonised peoples! Self-determination for all peoples!
4) Reproductive justice: Free, accessible contraception and abortion on demand! Defend bodily autonomy, whether for childbearing, abortion, or gender-confirming therapy! End sexism and domestic violence!
5) Free quality universal public health care now! Quality free public childcare and elder care for all, 24-7! End reliance on unpaid labour! Free education for a lifetime!
6) Full civil and human rights for the LGBTQIA+ community!
7) For climate justice! Public ownership of the energy industry under workers’ and community control to achieve emergency conversion to 100% renewable energy!
8) No British military interventions! Dismantle the war machine! End diplomatic, commercial and military relations with Israel! For a democratic secular Palestine! The right to self-determination of all peoples.
9) For the full integration of disabled people into social, political, and economic life!
10) Public ownership, under workers’ control, of big industry, transport, water and the banks! For a workers’ government and a planned economy—for socialism!