UK Treasury head cautions upcoming October budget would involve difficult decisions
Date
9/12/2024 4:17:55 AM
(MENAFN) On Wednesday, Rachel Reeves, the Chancellor of the Exchequer, warned that the upcoming October budget would involve "difficult decisions on tax, spending, and welfare" as the government faces a substantial financial shortfall. Her comments come amid escalating controversy over proposed reductions in winter fuel payments for pensioners, a policy that has sparked criticism from opposition parties and within her own Labour party.
Housing and Planning Minister Matthew Pennycook defended the decision to limit winter fuel payments to only the poorest pensioners in England and Wales. This proposal, which was subjected to a vote in the House of Commons on Tuesday night, saw a notable number of Labour MPs abstain. Despite the internal dissent, a Conservative motion aimed at blocking the proposed changes was defeated with a vote of 348-228. Pennycook acknowledged the concerns but stood firm, asserting that the policy would not be altered. "We’re not going to water down that policy. We think it’s the right decision to make," he stated.
Reeves also defended the cuts, explaining that they were necessary to address a significant "black hole" in the public finances. She emphasized the challenging nature of the decisions required, stating, "I did not want to strip winter fuel payments from millions of pensioners," but added that stabilizing the economy necessitates such tough measures. Her remarks came in the context of new data showing that the UK economy had stagnated in July for the second consecutive month, raising concerns about sluggish economic growth.
In her address to broadcasters, Reeves reiterated that the budget, scheduled for October 30, would involve challenging choices but promised that successful implementation could lead to economic stability, growth, and better job opportunities across the country. The proposed restrictions on the winter fuel allowance, which has been a longstanding form of support for pensioners during winter, are set to affect only the lowest-income households. While the policy has faced resistance within the Labour party, both Reeves and Pennycook have maintained that these measures are crucial for addressing the nation’s financial challenges.
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