Chancellor says businesses will understand balancing the books is necessary for fiscal stability
Rachel Reeves has dropped her strongest hint yet that she is planning to raise employer national insurance contributions in the budget, prompting accusations Labour is about to break a manifesto promise.
“So we are going to need to sort of close that gap between what government is spending and bringing in through tax receipts. But we are going to be a government that sticks to our manifesto commitments, including that one .”Reeves’s message was underlined by Keir Starmer, who told the summit in his keynote speech: “Our public services need urgent care, our public finances need the tough love of prudence – challenges we can’t ignore.
“But businesses get that. They know that we have got to pay for day-to-day spending through tax receipts, they want to see a path to balance the books, but we’ve got to do it in a way that is also ensuring that we remain competitive in the global economy.” Paul Johnson, the head of the Institute for Fiscal Studies, told Times Radio on Monday that such a move would count as a “straightforward breach” of the manifesto. “I went back and read the manifesto and it says very clearly, we will not raise rates of national insurance,” he said.
The summit was attended by high-level executives from a number of global companies, including Google, BlackRock and GlaxoSmithKline.
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