Working Britons will be forced to fund 25,000 more families on benefits thanks to Rachel Reeves’s Budget, the fiscal watchdog has admitted.
The Chancellor lifted the two-child benefit cap on Wednesday – with parents now able to claim Universal Credit and tax reductions for their third and any subsequent children.
The move was widely panned for buckling to the demands of the Labour left – several of whom were suspended from the party last summer after campaigning to do exactly what Ms Reeves did yesterday.
She said lifting it would bring 450,000 children out of poverty – at a cost to taxpayers of £3billion by 2030, according to the Office for Budget Responsibility (OBR).
Around 560,000 families’ payouts will soar by an average of £5,310 by that year, while many households will start to claim Universal Credit for the first time ever as a direct result of the Budget.
The total cost “includes £300million by 2029-30 for the cost of an estimated 25,000 additional entitled families making a claim as a result of the increase”, the OBR said.
Shadow Chancellor Sir Mel Stride said: “The OBR confirms it: this was a benefits Budget.
“Tens of thousands of additional families will now be claiming Universal Credit thanks to Labour making benefits more generous – the clearest sign yet that Labour has engineered a system where it pays more to claim benefits than to work.
“Rachel Reeves has chosen to put taxes up to pay for more and more welfare.”FOLLOW BELOW FOR LIVE UPDATES THROUGHOUT THE DAY…
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GB News readers will be the among the first to know how they will be affected by the Chancellor’s fiscal overhaul
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On Wednesday, Rachel Reeves unveiled her Budget after months of speculation and growing concern over the economy’s trajectory.
Among the changes announced by the Treasury include the extension of the income tax threshold freeze, a reduction in the cash ISA tax-free allowance and other controversial policies.
While journalists, economists, analysts and politicians debate who the winners and losers of this Budget will be, GB News readers will be the among the first to know how they will be affected by the Chancellor’s fiscal overhaul.
We have teamed up with Blick Rothenberg to share their free online Budget 2025 calculator. Simply fill out the relevant fields in the tool below, and find out whether you’ll be better off or not every year.
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Zia Yusuf: ‘Morally repugnant’ to make Britons pay more tax to fund £2TRILLION ‘runaway train’
Reform UK’s policy chief Zia Yusuf has led his party’s Thursday broadside against Rachel Reeves as the dust settles on her second Budget as Chancellor.
Mr Yusuf, writing in the Mail, has laid into crushing OBR forecasts which warn how British taxpayers will spend over £2trillion on welfare over the next six years.
Branding the country’s benefits system a “runaway train”, the Reform heavyweight said: “Taxpayers have suffered enough. People who set their alarm clocks and go to work are being asked to pay record amounts in tax, accept appalling public services and pay for a record number of people to not work. The tax burden is set to rise to a staggering 38 per cent of GDP by 2030 – a post-war high.”
Then, turning his fire on tax-funded schemes abroad like aid programmes in Pakistan and roads in Guyana, he vowed that only a Reform Government would “end the doom loop”.
If the Chancellor had listened to his plans, Mr Yusuf said, she could have saved £27billion – not raised taxes by £26billion.
Crowing Corbynistas declare victory after Rachel Reeves’s ‘Benefits Budget’
John McDonnell, Jeremy Corbyn’s Shadow Chancellor, hailed how Ms Reeves had buckled to the Labour left’s demands
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Leading Corbynista MPs declared victory yesterday after it was confirmed that Rachel Reeves would lift the two-child benefit cap – at working Britons’ expense.
John McDonnell, Jeremy Corbyn’s Shadow Chancellor, hailed how Ms Reeves had buckled to the Labour left’s demands after more than a year of pleading.
Labour suspended the whip from seven MPs – including Mr McDonnell – who backed a move to lift the cap last summer.
Then in September, more than 100 Labour MPs demanded the Chancellor scrap it.
Mr McDonnell said: “I want to pay tribute to all those who stood firm in the campaign to scrap this appalling policy, including all those of my colleagues who faced disciplinary action in the Labour Party but never wavered.
“We’ve won.”
