LABOUR CONFIRMS PLANS FOR HOUSEHOLD BILLS, MORTGAGES, RENT AND WAGES

The new Labour government has set out plans for tax, childcare, housing, household bills and more. Sir Keir Starmer and the Labour Party won the General Election on Thursday (July 4), defeating the Conservative Party at the polls, becoming Prime Minister.

In the wake of the win, all eyes are turning to what the Party has in store for the country, after Sir Keir won the role of PM. There will be changes for tax, household bills, personal finances and plenty else besides, according to the Labour manifesto.

The changes have emerged at a time of hope for the country, after 14 years of Tory rule. Sir Keir has built his Cabinet and launched exciting housing promises and pledges this week, as all eyes turn to the Labour government to deliver on what they've hinted at.

READ MORE UK tourists in Tenerife warned to pay £340 or face 'sleeping in a tent'

Tax

Labour promised no increases to income tax rates but they also made no proposals to increase tax bands either - resulting in ‘fiscal drag’. Many people will move into a higher tax bracket simply due to rising wages. The Government intends to keep tax bands frozen at their current thresholds until 2028.

Labour stated they will not increase NIC for individuals and Labour plans to ‘close the loophole’ through which private equity carried interest is currently taxed at 28% because it is treated as a capital gain. The rate that might apply in future is yet to be confirmed.

Sarah Coles, head of personal finance, Hargreaves Lansdown, said: "There was a pledge to increase taxes for specific groups – including non-doms and parents paying school fees if the cost of VAT is passed on. There was also silence on frozen income tax thresholds, hiking taxes for millions. Since the thresholds were frozen, 4.4 million more people have been forced to pay tax including 2.1 million dragged into paying basic rate tax and 1.88 million into higher rate tax."

Minimum wage

In its manifesto, Labour said it would introduce new legislation as part of its 'new deal for working people' within its first 100 days in power. The party has promised that this plan to 'make work pay' will ban exploitative work conditions and give workers more rights.

Labour's Plan to Make Work Pay commits to banning 'exploitative' zero hours contracts, ending fire and rehire by employers and introducing basic rights 'from day one' of a new job. This includes rights to parental leave, sick pay and protection from unfair dismissal.

The party has said it will implement its 'new deal for working people' in full within the first 100 days. However, the manifesto says that it will 'consult fully' with businesses, workers and civil society on how to put these plans into practice before legislation is passed.

Kate Palmer, Employment Services Director at Peninsula, said: “While most employers will be glad to get back to business as usual now we know which party will form the new government, Labour campaigned on a ‘Plan to make work pay’ so employers should be prepared for significant changes to employment law as they look to strengthen employee rights. With more than 60 proposed changes in their manifesto and a pledge to bring in the majority of these changes within 100 days of taking office, now is not the time to relax.“

Household bills

Daniel Särefjord, Aira UK CEO, said: “Labour’s manifesto has a noticeable focus on clean energy and energy security. The creation of GB Energy will help to introduce significantly more renewable energy into the country’s grid, bring down carbon emissions and create 650,000 jobs. Households struggling with their energy bills will be interested to learn more about their plans to invest in home insulation upgrades.“

Labour is building 1.5 million homes with the biggest boost to affordable, social and council housing for a generation and making work pay with a new deal for working people, as well as creating 650,000 good jobs across the country through the National Wealth Fund.

Housing and renting

The manifesto says: "Labour will switch on Great British Energy, a publicly-owned clean power company, to cut annual energy bills for good, paid for by a windfall tax on oil and gas giants, and we’ll insulate millions of homes – making families better off."

The Starmer government has set an ambitious five-year target and is looking at ‘new towns’ as solution to housing crisis. On Monday, the chancellor, Rachel Reeves, announced changes to the planning system to boost housebuilding, including the restoration of mandatory local housebuilding targets and the relaxation of restrictions on building on parts of low-quality green belt, which Labour has termed “grey belt”. Green belt is land protected under planning rules to prevent urban sprawl, whereas greenfields are open land.

Childcare

Over three thousand new nursery classes across England are set to open up access to childcare hours for families. Spare school classrooms will be converted into high quality spaces for nurseries, paid for by ending the tax breaks private schools enjoy.

Labour will deliver half a million more children hitting the Early Learning Goals by 2030. Labour will provide free breakfast clubs in every primary school in England, paid for by ending tax loopholes and clamping down on tax evasion.

Sarah Coles, head of personal finance, Hargreaves Lansdown, said: "There were clearer pledges for parents – including breakfast clubs in primary schools, the right to parental leave from day one of starting work, and protections against discrimination against pregnant women. When added to the roll out of free childcare to all children over nine months, this could make a significant difference to families."

2024-07-10T06:10:10Z dg43tfdfdgfd