UK Interest rates – latest: Hunt ‘weighs rise in capital gains tax’ to plug £50bn black hole

A Tory minister has said he expects “critical services will be protected” in the autumn statement amid warnings that any return to austerity would be a “gift to those who support children.”

It comes as a report by the Commission for Young Lives warned that systems to protect young people are “not fit for purpose.”

Asked if the necessary budgets will be protected in the upcoming spending review, policing minister Chris Philip said: “Well, obviously, we will need to wait and see what the chancellor says on 17 November.

“But I would expect, as the chancellor makes his decision in the coming weeks, the critical services will get protected.

Mr Philip assured the broadcaster that it would “certainly be a case I would be making,” but adds that we will have to wait to see what the Jeremy Hunt has decided in a couple of weeks time.

It never feels good to raise interest rates, the Bank of England governor has said, but considers the pain is necessary to spare the UK from larger and more damaging action further down the line.

“If we don’t bring inflation back down to target and if we leave it at a point where we don’t have price stability, the situation gets much worse,” Andrew Bailey told Sky News.

“The economy becomes more unstable, we would have much bigger fluctuations in output, in think we would have much bigger job losses.

“And at the end of the day, I’m afraid the action if we get in that situation that we have to be taken thereafter to restore stability would be much larger and much more damaging. So, its critical that we take the action.”

Asked if the pain was necessary to prevent something worse, Mr Bailey replied: “Yes.

Asked how it feels to inflict that on people, he said: “It never feels good, I don’t think anyone should think that central bankers are feel good doing this. But it is our job.”

The Money Saving Expert said tracker deals will rise by roughly £40 per month (£480/year) for every £100,000 worth of mortgage.

That means someone with a £300,000 mortgage will pay £1,440 extra per year. “Existing fixes won’t change, but when they end new deals will be far costlier,” Mr Lewis said.

My colleague Matt Mathers reports:

Tesco has introduced a fee of at least 28p for customers to charge their electric vehicles at their car parks.

The supermarket has been Britain’s largest provider of free power for electric car owners since it began rolling out charging bays at its stores in 2018.

With charging points at more than 550 of its UK stores, Tesco claims to have given customers enough electricity to travel some 86 million miles – the equivalent of looping the Earth’s surface nearly three and a half times.

But now those wishing to charge their electric cars while they shop must pay at least 28p per kilowatt hour (kWh) to do so, rising to 40p and 50p for the more powerful – and faster – 22kW and 50kW chargers respectively.

Olivier de Schutter, the UN rapporteur on extreme poverty, said he was “extremely troubled” by the prospect of public spending cuts – as the prime minister looks to balance the books after the disastrous mini-Budget.

Mr Sunak is believed to be mulling a 50-50 split of spending cuts and tax rises for the 17 November Budget, as he and chancellor Jeremy Hunt address a black hole of up to £50bn.

My colleague Adam Forrest has more:

The consequences of the 0.75 per cent interest rate hike will be huge for those who are exposed to them – primarily the relatively small number of people on tracker mortgages, and those with businesses on tracker loans. Such a hike is likely to add £100 a month to a typical mortgage.

The availability of free school meals has to be extended to all children in households on universal credit to combat the “devastating impact” of the cost of living crisis, ministers have been told.

More than 35 healthcare leaders and charity bosses have written to the chancellor, Jeremy Hunt, and the education secretary, Gillian Keegan, demanding an “urgent” expansion of the free school meals scheme to “improve children’s nutrition and protect their health”.

Labour leader Sir Keir Starmer said that families were now facing “a Tory premium on mortgages”, with the 0.75 point rise to 3 per cent in the Bank’s base rate likely to be passed on in the form of more expensive home loans.

As chancellor Jeremy Hunt issued a further signal of austerity measures to come in this month’s autumn statement, there were warnings from business not to repeat the mistakes of the early 2010s by cutting government investment.

Our political editor Andrew Woodcock has more:

The pound has dropped following the Bank of England’s aggressive 0.75 percentage-point rate rise and warnings of a recession that could last for two years.

Sterling fell 1.4 per cent to 1.123 against the US dollar, and was 0.8 per cent lower against the euro at 1.15.

Footfall took a stumble in its slow return to pre-pandemic levels as rising prices and tightening purse strings meant fewer consumers made trips to the shops, figures show.

Total UK footfall was down 11.8 per cent on October three years ago – a comparison to iron out pandemic discrepancies – two percentage points worse than September, according to British Retail Consortium (BRC)-Sensormatic IQ data.

High Street footfall was down 11.6 per cent, although this was 0.3 percentage points better than last month’s rate and an improvement on the three-month average decline of 11.9 per cent.

Read the details in this report: