PM: “Things will get worse before they get better”

Keir Starmer has assured wealth creation is still his government's “number one priority” but warned it won't happen overnight.

“Things are worse than we ever imagined”

In a speech this morning (27 August), the PM said his government has done more in seven weeks than the Conservatives did in seven years.

Blaming the Tories for “14 years of rot”, Starmer said things were worse than he’d imagined and that reform would require “overhauling” the entire system.

Because of the £22bn black hole in public finances created by the previous government, he will be forced to make hard decisions, he said.

Winter fuel payment changes “necessary”

When asked about his government’s plan to scrap winter fuel payments for pensioners, the PM said it had been a difficult choice but that it was necessary to repair public finances.   

Starmer said the government needed to prioritise measures that would benefit everyone, including pensioners, such as fixing the NHS and improving public transport.  

He added that his government was pushing for pension credit to go up and would explore “other allowances” to protect vulnerable pensioners.

Simon Francis, coordinator of the End Fuel Poverty Coalition, responded that the winter fuel payment axe is not about a rot in the system but about “basic fairness for older people facing soaring energy bills”.

Francis added that some older people would be facing the highest energy bills on record this winter as a result of the scrap and there would be dangerous health risks for those living in cold damp homes. He said the move would create a public health emergency which would put the NHS under even more pressure.

Taxes

The PM assured his government would not raise tax on ‘working people’, namely national insurance, VAT, and income tax – but implied there would likely be other tax rises.  

In response, Rishi Sunak posted on X (formerly Twitter) that Starmer’s speech was the clearest indication of Labour’s plan to raise taxes.

Green party co-leader Carla Denyer criticised Labour’s refusal to tax the super-rich. She said that people don’t need a ‘constant reminder that the Tories broke Britain’ but a new approach to get the investment communities desperately need.

October budget

Emphasising the ‘mess’ left by the previous government, Starmer asked the public to bear with him because “short-term pain” will be necessary for “long-term gain”.

He said October’s budget will be “painful” but he won’t shy away from “unpopular decisions” if it means doing the right thing for the country in the long run.