Sir Keir Starmer called trickle down economics a “piss take” as he tore into the new tax cuts announced by the government on Saturday.
Chancellor Kwasi Kwarteng announced on Friday that the 45p income tax rate paid by Britain’s highest earners will be axed, among a roster of other measures, including accelerating a planned 1p cut in the basic rate and the removing of the cap on bankers’ bonuses, aimed at taming inflation and boosting growth.
Speaking to a crowd of delegates ahead of the annual Labour Party Conference, which began today, Starmer accused the Tory party’s new tax-slashing agenda of engaging in trickle-down economics.
The Labour leader said: “If you earn £1m, you got a £55,000 tax break [on Friday]. That’s enough to employ a nurse.”
Under current rules, those on an annual salary of £1m must pay £470,821.48 in tax and National Insurance (NI) contributions. According to Kwarteng’s new mini-Budget, however, the amount to be paid out by these earners will now be £415,601.60 — a saving of £55,219.88 a year.
Sir Keir continued: “That’s their [the Conservative party’s] politics: make the rich, richer; make the super rich even richer. The theory is that if they are made even richer, some of it may one day trickle down into the pockets of other people.
“It didn’t work last time.
“Trickle down – it’s a piss take,” he added, to rapturous applause, cheering and whooping from the spectators.
“We have to expose it for what it is,” Starmer said. “We have to push it back. We have to beat it.”
The Labour leader announced plans to end dependence on fossil fuels, with all the country’s electricity generated by renewable and nuclear power by 2030.
Labour claims the plan would save UK households a total of £93 billion over the rest of the decade - or an average saving of £475 for each household every year.
Sir Keir said the plan would also allow the UK to be free from being “exposed to dictators” after Vladimir Putin’s invasion of Ukraine led to the current spike in global gas prices.
The green energy revolution is being presented as an alternative path to growth after Friday’s mini-budget saw Liz Truss and Kwasi Kwarteng set out a massive package of tax cuts in the hope of reviving a sluggish economy.
Sir Keir said: “The British people are sick and tired of rocketing energy bills and our energy system being exposed to dictators.
“They want long-term solutions to cut bills for good.”
In a speech to activists, Sir Keir said the Chancellor’s admission of Tory economic failure would be hung “around their necks” in the next election campaign.
He said: “There’s a change in the air. There’s an atmosphere, there’s a sense that Labour is ready to deliver.
“And don’t we need change after 12 years of this shower, 12 years of failure under this government, wages stagnant for 10 years, public services on their knees.”
It is already clear that the Chancellor’s mini-budget on Friday will set the dividing lines for the next general election, with Sir Keir telling Labour supporters: “I didn’t agree with almost anything he said in that financial statement yesterday apart from his opening sentence, when he said there’s a ‘vicious cycle of stagnation’.
“He’s right about that and it’s their vicious cycle of stagnation. That is the verdict on 12 years of Tory government, a vicious cycle of stagnation and we need to hang that around their necks.”
