Rachel Reeves

Under the Conservatives, the cost of our welfare system increased by nearly 1 percentage point of GDP—equivalent to £88 billion in just five years. The broken welfare system that we inherited wrote off millions of people as too sick to work. We will reform that system, so that it is a system that does not count the cost of failure, but rather one that protects people who cannot work and empowers those who can. We have brought back face-to-face assessments for disability benefits—those are the face-to-face assessments that the shadow Chancellor, the right hon. Member for Central Devon (Sir Mel Stride), got rid of when he was Work and Pensions Secretary. Our changes to universal credit will get 15,000 people back into work—a figure confirmed today. The former Heath Secretary, Alan Milburn, will review the causes of rising youth inactivity, and we are already taking action. I am grateful to the Federation of Small Businesses and Small Business Britain for their representations on apprenticeships, and today I am announcing funding to make the training for under-25 apprenticeships completely free for small and medium-sized enterprises. I am funding our new youth guarantee, providing £820 million over the next three years to give the young people who were let down by the Conservatives the support and opportunity they deserve, guaranteeing every young person a place in college, an apprenticeship or personalised job support. After 18 months, 18 to 21-year-olds will be offered paid work, not benefits. The Motability scheme was set up to protect the most vulnerable, not to subsidise the lease on a Mercedes-Benz, and so I am making reforms that will reduce generous taxpayer subsidies. Motability have confirmed that it will remove luxury vehicles from the scheme, getting the scheme back to its original purpose of offering cost-effective leases to disabled people. Taxpayers’ money should not be spent on pensions for people abroad who only lived here for a couple of years and may never have paid a penny of tax. The Conservatives allowed thousands of people living abroad to buy their way into the state pension for as little as £3.50 a week, debasing the purpose of our pension system. I will abolish access to class 2 voluntary national insurance contributions for people living abroad, increasing the time that someone has to live or work in Britain to 10 years, and increasing the contributions they must pay. These reforms improve our welfare system: they support our young people; protect those who need it most; and put an end to Conservative waste and unfairness. To break the cycle of austerity we need a fair and sustainable tax system, one that generates revenues to fund the public services we all use, and supports investment to grow our economy. That does mean that today I am asking everyone to make a contribution. The previous Conservative Government froze personal tax thresholds from 2021 until 2028. Today, I will maintain all income tax and equivalent national insurance thresholds at their current level for three further years from 2028—[Interruption.]