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Chancellor Jeremy Hunt has announced deep spending cuts and tax rises in an autumn statement he said was “fair” and would restore market confidence shaken by his predecessor’s mini-budget.<\/b><\/p>\n<\/div>\n<\/div>\n\n
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He said about half of his \u00a355bn “plan for stability” would come from tax rises, and the rest from spending cuts.<\/p>\n<\/div>\n<\/div>\n
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Mr Hunt said the UK was “now in recession” but insisted his plan would mean a “shallower downturn”.<\/p>\n<\/div>\n<\/div>\n
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He said “difficult decisions” were necessary to “rebuild our economy”.<\/p>\n<\/div>\n<\/div>\n
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The Office for Budget Responsibility’s forecasts painted a bleak picture, with the UK economy predicted to shrink by 1.4% next year.<\/p>\n<\/div>\n<\/div>\n
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Responding to Mr Hunt, Labour’s shadow chancellor, Rachel Reeves, said the UK was being held back by “12 years of Conservative economic failure”.<\/p>\n<\/div>\n<\/div>\n
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“Never again can the Conservatives be seen as the party of economic competence,” she said.<\/p>\n<\/div>\n<\/div>\n
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\n- Follow live as Hunt unveils his autumn statement<\/li>\n
- UK in recession and set to shrink further – Hunt<\/li>\n
- Autumn Statement 2022: Key points at-a-glance<\/li>\n<\/ul>\n<\/div>\n<\/div>\n<\/div>\n
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In a statement to MPs lasting just under an hour, the chancellor said income tax thresholds would be frozen until April 2028, which means millions of people will pay more tax.<\/p>\n<\/div>\n<\/div>\n
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“I have tried to be fair by following two broad principles: firstly, we ask those with more to contribute more; and secondly, we avoid the tax rises that most damage growth,” he said.<\/p>\n<\/div>\n<\/div>\n
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‘Picked pockets’<\/span><\/h2>\n<\/div>\n\n
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On public spending, he said department budgets would face real-terms cuts because of inflation and pressure on public sector wages.<\/p>\n<\/div>\n<\/div>\n
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Mr Hunt told MPs “this is a balanced path to stability: tackling the inflation to reduce the cost of living and protect pensioner savings whilst supporting the economy on a path to sustainable growth”.<\/p>\n<\/div>\n<\/div>\n
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Labour’s shadow chancellor said by freezing tax thresholds, the Conservatives “have picked the pockets of purses and wallets of the entire country”.<\/p>\n<\/div>\n<\/div>\n
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In other key measures announced by Mr Hunt: <\/p>\n<\/div>\n<\/div>\n
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\n- The household energy price cap has been extended for one year beyond April but made less generous, with typical bills capped at \u00a33,000 a year instead of \u00a32,500<\/li>\n
- There will be additional cost-of-living payments for the “most vulnerable”, with \u00a3900 for those on benefits, and \u00a3300 for pensioners<\/li>\n
- The top 45% additional rate of income tax will be paid on earnings over \u00a3125,140, instead of \u00a3150,000<\/li>\n
- UK minimum wage for people over 23 to increase from \u00a39.50 to \u00a310.42 an hour<\/li>\n
- The windfall tax on oil and gas firms will increase from 25% to 35%, raising \u00a355bn from this year until 2028<\/li>\n<\/ul>\n<\/div>\n<\/div>\n<\/div>\n
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The autumn statement is a crucial test of confidence in Prime Minister Rishi Sunak, whose ruling Conservative Party is lagging far behind Labour in the opinion polls.<\/p>\n<\/div>\n<\/div>\n
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It comes 55 days after Mr Hunt’s predecessor, Kwasi Kwarteng, touted a “new era for Britain”, unveiling the biggest package of tax cuts in decades.<\/p>\n<\/div>\n<\/div>\n