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2h ago

Labour Links Brexit and Farage to Weak Economy as Budget Choices Loom

An expected OBR productivity downgrade leaving a £20bn to £30bn gap has prompted talk of tax increases.

Wes Streeting with Rachel Reeves and Sir Keir Starmer at an event in the summer. He says the country faces an “enormous amount of jeopardy”
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Overview

  • Wes Streeting said he is glad ministers can now acknowledge Brexit as part of the UK’s economic problems, calling the situation one of “enormous” jeopardy.
  • Reports indicate the prime minister and chancellor plan to argue in the November Budget that Brexit, championed by Nigel Farage, underlies weaker growth and potential tax rises.
  • Treasury officials expect the OBR to cut productivity forecasts, creating a fiscal shortfall that ministers are preparing to address in next month’s plans.
  • Options being weighed reportedly include an income tax rise, which would breach Labour’s pledge not to increase income tax, VAT or national insurance.
  • The Independent has reported a roughly 5% drop in EU trade since Brexit costing UK businesses about £37bn a year, as Reform UK’s Richard Tice denounces Labour’s strategy as hypocritical.