Politics latest: Tories 'have learned nothing from Truss' after 'unfunded' tax cut vow (2024)

Reforming the House of Lords "isn't top of the agenda" despite frustration with peers for opposing the government's Rwanda plan, the prime minister has said.

Speaking during a Q&A event at a pub in South Yorkshire, said parliament's "unelected" upper chamber "are blocking it".

Peers have inflicted a series of defeats this week on government legislation that would declare Rwanda a safe country.

It needs to become law before asylum seekers can be flown to the country after the Supreme Court ruled last year that it was an unsafe destination for them to be sent.

"The elected House of Commons passed our bill unamended, and we have got a new treaty with Rwanda that says that it's safe," said the PM.

"Rwanda has given us all the assurances to address the concerns that our judges have - the House of Commons, elected, has said 'that's great, let's crack on with that'.

"And it's now the unelected House of Lords that are blocking it."

But asked whether he would make changes to the Lords, Mr Sunak said nothing would happen anytime soon.

"Of all the things I'm grappling with, doing long-term constitutional reform of the House of Lords isn't top of the agenda," he said.

Mr Sunak reiterated his priorities were the economy, waiting lists, and stopping the boats.

A minister who publicly criticised a key money-raising feature of yesterday's budget still has Rishi Sunak's confidence, Number 10 says.

Andrew Bowie was quick to express his displeasure with the expansion of the windfall tax on oil and gas companies, which the chancellor said was justified because of how high energy bills still were.

But the prime minister's spokesman has insisted he "supports the budget" overall and has spoken to the chancellor.

Asked whether the PM retains confidence in him, the spokesman said: "Yes."

As we've reported already today, the taxpayer was billed £15,000 to pay for a legal settlement Science Secretary Michelle Donelan reached after claiming an academic was a Hamas supporter.

Labour leader Sir Keir Starmer has now called for Ms Donelan to pay the money back.

Speaking to broadcasters this morning, Sir Keir said: "I think most people watching this would be aghast.

"The government is telling them every day that they can't do any more to help them, people are really struggling to pay their bills and the government says we can't afford to help you any more.

"People know that public services are crumbling, and then you've got a minister who says something she shouldn't have said, then has to pick up a legal action and pay damages and costs, and then says the taxpayer is going to pay for that.

"Totally insulting, we need a change.

"I'll tell you something else, if we're privileged enough to come into power and have a Labour government, we will never allow that sort of thing to happen. That will be history."

Yesterday, the government co-opted Labour's plan to reform the non-dom tax status.

The Tories have used this to fund tax cuts, whereas Labour would have used it to spend on new projects.

The opposition is now being pushed to explain what its new financial plans are, as the budget gets debated in the House of Commons.

Rachel Reeves said: "I will always be clear that all of our policies in our manifesto will be fully-costed and fully-funded.

"Now the Tories have U-turned on their policy on non-doms, which we welcome, we will do the necessary work to show how our plans will be paid for.

"We will set that out in an orderly and a responsible way."

Mel Stride, the work and pension secretary, said: "She [Rachel Reeves] has also of course accepted our tax measures as set out in the budget yesterday, including the changes that we are making to the non-dom arrangements, the abolition of non-dom status, and the windfall tax for oil and gas.

"She has of course hypothecated the money raised from those two measures many times over for the NHS, for dentistry, for breakfast clubs and so on.

"Now she has accepted all the tax measures in the budget and I invite her to come back to the despatch box now – I will give way.

"Could she let us know whether she is now going to U-turn again on the spending commitments that she has made around the NHS and dentistry, or whether she is going to put taxes and borrowing up?"

Speaking to Sky News this morning, Chancellor Jeremy Hunt said his working assumption is that a general election will take place in the autumn.

The prime minister has now been asked whether - as some have speculated - an election will take place in May.

Mr Sunak told the BBC: "I'm not going to say anything extra about that.

"What I would say is what matters is the choice at that election, and the choice, especially after this budget, is clear.

"Our plans are working.

"Of course there's more work to do, we are starting to deliver the change that people want to see and if we stick with that plan people can have the peace of mind that there is a brighter future for them and their families."

Multiple Labour shadow ministers have predicted this week that the general election will coincide with local elections on 2 May.

Rishi Sunak has been asked about his science secretary, Michelle Donelan.

Ms Donelan agreed a legal settlement worth £15,000 with an academic, after questioning whether the person supported Hamas.

The taxpayer paid for the £15,000.

Mr Sunak said: "Obviously you will understand I've been focused on the budget, but my understanding of this is that Michelle raised some concerns about some articles that had been shared talking about what happened on 7 October.

"I think subsequently to that, those thoughts I think have been clarified and Michelle has withdrawn those concerns.

"With regard to the settlement, it is a long-standing convention stretching back many years, over different governments of all different parties, including Labour, that the government will fund those legal disputes when it relates to government ministers doing their work."

After being trumpeted by a minister on Politics Hub With Sophy Ridge last night, and repeated by the chancellor this morning, Rishi Sunak has reiterated the government's plan to scrap national insurance.

The prime minister said it was his "long-term ambition" after a 2p cut in yesterday's budget, which followed exactly the same cut in last year's autumn statement.

Speaking at an event at a pub in South Yorkshire, Mr Sunak described national insurance as a "tax on work".

"We have this unfairness where if you're working, you pay tax twice - once in income tax and then again in national insurance," he said.

"That's unnecessarily complicated because all of that money ultimately goes into the same pot, funds the same public services.

"But my ultimate ambition is to remove that unfairness entirely, and if we stick to our plan, not just will we deliver the £900 of tax cuts this year, we can really make progress towards that long-term ambition over time in the next parliament."

The plan has been criticised as being "unfunded" by Labour, which has compared the vow to those made by Liz Truss (see 11.12 post).

The Institute for Fiscal Studies has offered a similarly damning verdict (see 10.53 post).

The reactions gathered by the Sky News Voters Panel to the budget yesterday have been praised in the House of Commons.

Lucy Powell, Labour shadow leader of the house, quoted them while criticising the Conservative's plans.

She told the Commons: "The Sky News Voters Panel of 2019 Tory voters couldn't be more damming: 'absolutely farcical' said one, 'they've got no plan said another', who thought the budget was a great vote loser.

"'A waste of time, and it's time for them to go', said a third, and that's because on the big issue this budget changes nothing."

Read more from the Voters Panel reaction to the budget below...

It was revealed earlier this week that Michelle Donelan, the science secretary, used £15,000 of the taxpayer to settle a legal issue after she accused an academic of having sympathy for Hamas.

Lucy Powell, Labour's shadow leader of the house, asked the Commons leader Penny Mordaunt about it at their weekly showdown.

Ms Powell asked if Ms Mordaunt still has confidence in Ms Donelan.

Responding, Ms Mordaunt sought to defend Ms Donelan by suggesting her character as a whole should be considered - including the fact she did not take the roughly £16,000 payout she was entitled to when she resigned as education secretary in 2022.

She had accepted a promotion from Boris Johnson less than 36 hours earlier, and was brought back to cabinet when Liz Truss took over.

You can read more background to the story here:

Labour leader Sir Keir Starmer has been speaking to broadcasters this morning, as he continues to attack yesterday's budget.

Sir Keir says it was "humiliating" for the government to scrap the non-dom tax scheme after complaining about it for years while Labour advocated for the change.

"And now completely out of ideas, the only decent policy they got is the one that they've lifted from us," Sir Keir says.

"And I think if you needed evidence of why we should go straight to a general election, it's that. We need change."

Sir Keir says nothing in his manifesto will be "unfunded" or "uncosted.

He goes on: "Contrast that with the government, where yesterday, at the end of the budget, the chancellor made a staggering £46bn unfunded commitment to abolish national insurance.

"That's bigger than Liz Truss's commitment.

"So they've learned absolutely nothing, we need change. It's time for change."