Kemi Badenoch has warned that Britons face “more hardship” unless Andy Burnham rules out tax rises to pay for his spending spree. The Conservative Party leader said Labour is using taxes to pay for a welfare bill that “continues to climb ever higher”.
Prime Minister's tour
Her intervention comes as the Prime Minister begins a tour of the UK on Tuesday to listen to Britons’ living concerns. But critics are concerned that no funding programme has been outlined to fund his spending commitments and the only way to pay for them will be higher taxes.
Writing in the Express, Mrs Badenoch added: “Labour came into power promising lower taxes. Yet, from the ‘jobs tax’ national insurance hike, to the family farms and family business taxes, they have squeezed firms dry, forcing up prices and the costs of hiring staff. As a result, jobs and growth have disappeared.
“The worst part about it is that the Labour government is spending much of the revenue from their new taxes servicing a welfare bill that continues to climb ever higher.
“Burnham and his new Chancellor John Healey face a tricky test at the budget this autumn.”
She added: “Andy Burnham must rule out any new taxes this autumn. The alternative is more hardship and fewer jobs.”
Welfare and unemployment
The UK spends more than £300 billion on welfare each year, making up about a quarter of government spending. There are now 6.6 million people claiming out of work benefits, up by 2.7 million since 2019.
Mrs Badenoch and campaigners have pointed to cost hikes which have crippled businesses since Labour came to power in 2024. She warned the government’s measures have squeezed firms by forcing up prices and the costs of hiring staff. Former Chancellor Rachel Reeves raised the rate of employer National Insurance Contributions (NICs) from 13.8% to 15%. Labour also hiked the national minimum wage by 50p to £12.71 for over 21s.
The UK unemployment rate stands at 4.9%, with approximately 1.76 million people unemployed.
Mrs Badenoch said: “The cost of living is getting worse, unemployment continues to rise, and they need to find the money to pay for Britain’s defence in a world that is getting more and more dangerous.
“What they should be talking about is how they intend to cut government spending, cut welfare and make sure our armed forces get the support they need. Instead, they’re talking about more taxes.”
Government measures
Mr Burnham’s government has announced it will cut business rates for pubs, clubs, and live music venues in England by 20% from April to help the sector. But many are still struggling with high energy bills. No 10 said the Prime Minister's plans are to "give people some room to breathe" ahead of the budget on October 28.
Subscriptions will be easier to cancel and companies will be compelled to make it clear when contracts auto-renew at a higher price, under government plans. The announcement is Mr Burnham's latest intervention to try and ease the cost of living, following a £2 bus fare cap in England and an unfunded VAT cut on household electricity bills.
But Dennis Reed, director of over-60s campaign group Silver Voices, said: "Unless all these minor consumer measures are backed up by policies that make a real difference to pensioners' incomes they will inevitably be seen as gimmicks.
“Andy Burnham already knows what he must do, as he heard it loud and clear on the doorsteps in Makerfield, unfreeze personal allowances in the Autumn Budget. 10 million older people are already paying some tax on their state pensions and they will all feel failed if Burnham fails to deliver on the expectations he raised.
“If he wants to revitalise the high street, as well as putting more spending money in people's pockets, he should ban app-only car parking and get banks to reopen their high street branches.”
Economic concerns
With the fallout of the Iran war keeping inflation higher than expected, the cost of living remains a major concern among the public. A poll published by Ipsos at the end of July found 30% of people listed the economy as a major concern while 22% listed inflation or prices specifically.
But Mr Burnham did not rule out tax rises to help pay to fix social care in England. He acknowledged tax rises could also be necessary but insisted Labour’s manifesto commitments not to increase workers’ income tax, national insurance or VAT rates would remain in place.
The Labour leader has so far declined to rule out introducing a new "death tax", potentially a 10% flat-rate levy on all estates, to fund his proposed National Care Service. A flat levy could drag millions more into paying a fee on their loved ones’ estates.
Under the current tax rules, married couples can hand down £1million of assets tax-free to their children, with death duties only paid on anything above that amount. The Treasury raises close to £9billion a year from inheritance tax. Government spending on social care is forecast to hit £39billion by the end of the decade.
Speaking at a care home at the end of last month, the PM said “I think we owe it to the public before we talk about tax rises” to “do more with what you’ve got”. But he said that “some of what we want to do in the fuller sense will require difficult, difficult decisions” and “we will be honest with people about those”.
In an indication tax hikes to pay for social care could be in Labour’s next election manifesto, the former mayor of Greater Manchester: “We will put them before the country at the right time, and we will hopefully proceed with people’s consent.”
A Labour Party spokesman said: "With Andy Burnham’s leadership, the Labour government will finally confront the social care crisis Westminster has ignored for decades, giving people dignity, security and support while easing pressure on the NHS.
“We won't fix this through politics as usual, but by focusing on problem solving rather than point scoring.”
