Reeves to unveil ‘tough decisions’ to fix public finances as junior doctors offered pay rise

Rachel Reeves is set to announce “very tough decisions” to address a public spending black hole of around £20 billion in the government accounts.

The chancellor is expected to unveil billions of pounds worth of public spending cuts in projects including road and rail sector, and a spending reduction on external consultants.

In a speech in the House of Commons, Ms Reeves will accuse the previous Conservative government of “covering up the true state of the public finances” as she reveals the results of the Treasury spending audit in a bid to “restore economic stability”.

But the long-waited announcement comes with tax fears after director of the Institute for Fiscal Studies Paul Johnson said it is “pretty likely” the party would raise taxes in some form.

Junior doctor strikes could come to an end after the government offered unions a new 20 per cent pay deal.

Following negotiations, health secretary Wes Streeting and the British Medical Association have come to an agreement which will be put to junior doctors to vote on, according to reports in The Times.

Key Points

• IFS: Labour ‘pretty likely’ to raise taxes in some form

• Chancellor set to announce steps to cut government costs

• Junior doctors offered 20% pay rise to head off strikes

• Starmer rejects post-Brexit youth mobility scheme with Spain

• Pat McFadden claims Tory government misled the OBR

• Reeves says previous government ‘covered up’ financial turmoil

Southport MP ‘deeply concerned’ after stabbing incident

14:34 , Salma Ouaguira

Labour MP for Southport Patrick Hurley has said he is “deeply concerned” by reports of eight people including children being injured in a stabbing attack in the area.

Armed police detained a man and seized a knife, with one eyewitness saying the incident was like “a scene from a horror movie”.

In a statement, he said: “I am hoping for the best possible outcomes to the casualties affected.

“My thoughts go out to all those affected, their loved ones and to the entire community.”

Home secretary Yvette Cooper declared she has been in touch with Merseyside’s police and crime commissioner “to convey full support to the police and thanks to the emergency services responding”.

Tories claim Labour government ‘paving the way for tax rises’ ahead of Reeves’ speech

14:30 , Salma Ouaguira

The government is trying to set a narrative to pave the way for tax rises, Helen Whately said.

The shadow transport secretary said chancellor Rachel Reeves “would have known about the state of the public finances” while serving in opposition because of the Office for Budget Responsibility.

Ms Whately added: “Actually while Labour is going out there and trying to tell everybody that it is all so difficult for them, this is just them setting a narrative for tax rises that they want to bring in later on.

“But actually they took over an economy that had the fastest growth in the G7, that had the deficit halved compared to when we took over in 2010, that had historic low unemployment and that had inflation back down at 2%.

“So, really good fundamentals for them to build on in government.”

Pictured: Cabinet ministers leave Downing Street ahead of Rachel Reeves statement

14:26 , Salma Ouaguira

Tory candidate most feared by Reform wants nothing to do with Farage

14:20 , Salma Ouaguira

Robert Jenrick has told Tory members there will be no deal with Nigel Farage if he is elected leader of the party to replace Rishi Sunak.

The former home office minister, who resigned because he did not think Mr Sunak was strong enough on the Rwanda deportation flights, has emerged as the leading candidate of the right in the leadership race.

Speaking at an event in Upminster in Essex this week, Mr Jenrick told party members that he plans to win back Tory voters who defected to Farage’s Reform.

But unlike fellow right-winger Suella Braverman – who is leading in support among party members but struggling to get enough MPs to nominate her – Mr Jenrick said there would be no deal with Mr Farage.

Tory leadership candidate most feared by Reform wants nothing to do with Nigel Farage

Fifth Tory MP endorses Robert Jernick for party leader

14:16 , Salma Ouaguira

MP for Huntingdon Jonathan Djanogly has announced he is endorsing Tory leadership hopeful Robert Jernick.

324 peers are in line for the chop under Labour plans

14:11 , Salma Ouaguira

A total of 324 members of the House of Lords are in line to be booted out under Labour’s plans to reform the upper chamber, Archie Mitchell writes.

The party’s manifesto included a mandatory retirement age of 80, the removal of hereditary peers and a new participation requirement to be introduced in Sir Keir Starmer’s first term in power.

And figures released by the government on Monday show 324 peers would be aged 80 or over and therefore in line to be removed from the upper chamber by a potential June 2029 election.

They would be made up of:

• 92 Labour members

• 87 Conservative members

• 87 Crossbench members

• 37 Liberal Democrat members

• 12 Non-affiliated members

• 3 Democratic Unionist Party members

• 2 Ulster Unionist Party members

• 1 Conservative Independent member

• 1 Independent Social Democrat member

• 1 Independent Ulster Unionist member

• 1 Plaid Cymru member

Rachel Reeves to announce ‘very tough decisions’ in drive to fix public finances

14:10 , Salma Ouaguira

Rachel Reeves will announce “very tough decisions” to address a public spending black hole of around £20 billion – but no tax rises should be expected, a senior minister has said.

Cabinet office minister Pat McFadden said Labour’s election promise not to raise income tax, national insurance or VAT would “still hold” ahead of the Chancellor’s statement on Monday afternoon.

“Today is not a budget, people shouldn’t expect tax announcements today,” Mr McFadden told Times Radio. “We said a number of things about tax during the election, we said that we wouldn’t increase income tax rates, national insurance rates, or VAT. Those things still hold.”

Ministers have in recent days sought to suggest the economic inheritance is worse than they expected, even though the Institute for Fiscal Studies (IFS) think tank issued a stark warning about the state of the public finances ahead of the General Election.

Mr McFadden also suggested Labour had discovered new information since winning the poll, adding: “Today what you will hear is how we are going to respond to that opening of the books.”

He gave the example of the Rwanda scheme, previously estimated to cost £400 million.

How could Labour raise taxes?

14:00 , Salma Ouaguira

With Rachel Reeves set to unveil a £20 billion ‘black hole’ in public finances today, there are rumours that Labour’s first autumn statement will bring new tax raising measures.

The party says it will better manage existing resources to cut costs, as well as attract investment from the private sector to help finance some public projects.

But it is now likely that the government will look to new ways to raise revenue. Here are some of the key measures they could implement in the autumn statement:

• Taxing pensions savings: Pension tax relief is a reduction on the amount of tax paid on private pensions. It helps workers save for retirement by boosting their pension pots. The measure would raise around £3 billion a year, with 7 million earners paying more tax. But it would be better news for basic rate earners, who would actually begin receive a 10 per cent boost to their pension contributions.

• Closing Inheritance Tax loopholes: Inheritance Tax is a levy on the estate of someone who has died. This is their property, money and possessions. Crucially, it is not paid if the value of these things are below £325,000. The economic think tanks said ending these measures alone would raise £4.8 billion a year by 2029.

• Changing Council Tax: Council tax is a local tax which provides funding for the local authority to which it is paid. The amount will vary by area, but can range from £1,500 a year to upwards of £4,000 depending on area and property value.

• Raising Capital Gains Tax: Capital Gains Tax (CGT) is paid on the profit made when an asset that has increased in value is sold. It is applies to things like the sale of personal possessions worth more than £6,000 (apart from a car), property that’s not the seller’s main home, shares and business assests. It is charged at 10 or 18 percent for basic rate taxpayers, and 20 or 24 for higher or additional rate earners. There is a tax-free allowance of £3,000.

Minister claims Tories hid issues as Reeves set to unveil black hole in finances

13:50 , Salma Ouaguira

A cabinet minister said the Tories left a “catastrophic” inheritance and covered up the extent of the issues, as chancellor Rachel Reeves is expected to unveil a black hole in the public finances of around £20 billion.

Environment secretary Steve Reed was asked if Labour’s shock about discovering the state of public finances after coming to power was “theatre”.

Mr Reed said on Sunday: “It’s not only that we didn’t know, the prime minister deliberately covered it up.”

He pointed to the state of prisons and the Rwanda policy as examples of public finance issues the Labour government is learning the true extent of after taking office.

But did not confirm that Labour would consider pensions relief and capital gains and inheritance levies to plug the gap.

“I don’t see the benefit in speculating when we don’t even know the full scale of the problem yet,” he said, adding: “We’re not going to shy away from difficult decisions.”

Downing Street ‘concerned’ over Nicolas Maduro’s victory in Venezuelan election

13:40 , Salma Ouaguira

Downing Street has received the victory of Nicolas Maduro with scepticism and claimed to be concerned over “serious irregularities” in the Venezuelan electoral counting process.

The United Socialist Party of Venezuela leader was declared the winner of the country’s presidential election, but the opposition dismissed the result as fraudulent.

Reacting to the results, a No 10 spokesperson said: “We are concerned by the allegation of serious irregularities in counting and declared results. And we are calling for the swift and transparency of detailed results to ensure the outcome reflects the votes of the Venezuelan people.

“The UK does not currently recognise the Maduro regime and we would wait to ensure that the outcome reflects the votes of the Venezuelan people.”

Tommy Robinson ‘leaves UK’ amid contempt case as arrest warrant issued

13:30 , Salma Ouaguira

Tommy Robinson has left the country after committing “flagrant” contempt of court relating to a film played at a protest in central London, the High Court has been told.

An arrest warrant has been issued for Robinson, real name Stephen Yaxley-Lennon, after he failed to appear at the Royal Courts of Justice on Monday for a hearing in a contempt of court case.

The Solicitor General launched legal action against Robinson, 41, in June over an alleged breach of a court order after he lost a libel battle in 2021.

But Adam Payter, representing the Solicitor General, said on Monday it is believed the English Defence League founder left the jurisdiction hours after being released on unconditional bail following his arrest over the weekend.

Tommy Robinson ‘leaves UK’ amid contempt of court case as arrest warrant issued

Government ‘pleased’ with ruling on puberty blockers

13:20 , Salma Ouaguira

The government is “pleased” with the High Court’s ruling that a ban on puberty blockers introduced by Conservative ministers was lawful, Downing Street has said.

The prime minister’s official spokesman told reporters: “The Government welcomes the court’s decision. Children’s health care must be evidence-led.

“We’ve always been clear that the Cass Review was clear that there was insufficient evidence that puberty blockers are safe and effective for children with gender dysphoria and gender incongruence. Therefore, we must act cautiously and with care when it comes to this vulnerable group of young people.

“So we were obviously pleased that the court has upheld the ban.”

Who will be the next Tory leader? All the front runners ranked from Priti Patel to Kemi Badenoch

13:10 , Salma Ouaguira

The Conservatives’ latest leadership contest is underway after Rishi Sunakled the party to its worst election defeat in history.

A string of senior figures have thrown their hats in the ring to succeed the former PM and lead the party through the next five years in opposition.

Candidates must win the support of 10 Conservative MPs before the Monday deadline in order to make it onto the ballot paper.

With the shortlist to be whittled down gradually until a final four are paraded in front of the party faithful at October’s Tory conference, The Independent looks at the runners and riders to take the reins from Mr Sunak.

Who will be the next Tory leader? The Tory frontrunners from Patel to Badenoch

Foreign secretary condemns rocket strike on Israeli-controlled Golan Heights

13:00 , Salma Ouaguira

Foreign secretary David Lammy has condemned a rocket strike in the Israeli-controlled Golan Heights, saying Hezbollah must cease their attacks.

David Lammy tweeted: “The UK condemns the strike in Golan Heights that has tragically claimed at least 12 lives.

“We are deeply concerned about the risk of further escalation and destabilisation. We have been clear Hezbollah must cease their attacks.”

The strike on Saturday, which the Israeli military said killed 12 children and teenagers, has raised fears that conflict could escalate in Lebanon.

Israel has blamed Hezbollah, but the group issued a statement to say it “categorically denies” being behind the attack.

Hezbollah commanders told the UN that what hit the football pitch was an Israeli anti-rocket interceptor projectile.

Benjamin Netanyahu claimed that the Lebanese militant group “will pay a heavy price for this attack, one that it has not paid so far”.

Small boat arrivals hit record high for first seven months of the year

12:51 , Salma Ouaguira

Around 255 people were detected crossing the English Channel to the UK on Sunday.

According to provisional figures from the Home Office, the cumulative number of arrivals so far in 2024 to 16,457, a new record for the first seven months of a calendar year.

The previous record for arrivals in the seven months from January to July was 16,420 in 2022.

There were 14,732 arrivals in the first seven months of 2023.

Monthly data comes from the most recent Home Office quarterly update on irregular migration to the UK, which presents the “final and authoritative statistics on small boat arrivals”.

There were 29,437 arrivals across the whole of 2023, down 36% on a record 45,774 arrivals in 2022.

No 10: Just Stop Oil action not ‘winning people around’ to climate cause

12:42 , Salma Ouaguira

Just Stop Oil protesters blocked an entrance to a security search area at Gatwick airport in an apparent attempt to disrupt travellers trying to make their flights.

Seven activists entered the airport’s South Terminal this morning, with the group stating that “the situation is currently developing”.

But Downing Street said their actions are not “winning people around” to their cause.

Asked for the prime minister’s message to the demonstrators, his official spokesman told reporters: “Obviously we recognise the democratic right of people to peacefully express their views, but obviously they should do so within the bounds of the law. And clearly being seen to significantly disrupt people’s summer holidays is no way of winning people around to your cause.

“I can’t comment specifically on the case that you’re reporting which is obviously ongoing, but we obviously thank anyone involved for preventing any significant disruption.”

A spokesperson for the aviation hub told The Independent that despite the protest, London Gatwick is open and “operating normally today”.

Streeting welcomes puberty blockers ruling

12:40 , Salma Ouaguira

The High Court has ruled the ban on puberty blockers introduced by the Conservative government with emergency legislation was lawful.

Following the ruling, health secretary Wes Streeting said: “I welcome the court’s decision today. Children’s healthcare must be evidence-led.

“Dr Cass’s review found there was insufficient evidence that puberty blockers are safe and effective for children with gender dysphoria and gender incongruence.

“We must therefore act cautiously and with care when it comes to this vulnerable group of young people. I am working with NHS England to improve children’s gender identity services, and to setting up a clinical trial to establish the evidence on puberty blockers.

“I want trans people in our country to feel safe, accepted, and able to live with freedom and dignity.”

Rayner to set out overhaul of planning rules to clear path for new social housing

12:32 , Salma Ouaguira

Angela Rayner will unveil an overhaul of planning rules next week as Labour seeks to clear a path to building 1.5 million homes in five years.

The deputy prime minister and housing secretary said that “delivering social and affordable houses at scale” is her “number one priority”.

But the planning system should be “a launchpad” rather than a “millstone” dragging down the housing market, she wrote in The Observer.

Our political correspondent Archie Mitchell has the full story:

Rayner to overhaul planning rules to clear path for new social housing

Breaking: Junior doctors offered 20% pay rise to head off strikes

12:30 , Salma Ouaguira

Junior doctor strikes could come to an end after the government offered unions a new 20 per cent pay deal, it has been reported.

Following negotiations, health secretary Wes Streeting and the British Medical Association have come to an agreement which will be put to junior doctors to vote on, according to reports in The Times.

According to paper, the new deal will represent an overall pay rise of 20 per cent, worth £1 billion, which includes a backdated pay rise of 4.05 per cent for 2023-24, on top of an existing increase of between 8.8 per cent and 10.3 per cent.

Under the offer, junior doctors will be given a further pay rise of 6 per cent for 2024-25, which will be topped up by a consolidated £1,000 payment.

Junior doctors offered 20% pay rise to head off strikes

No 10 ‘extremely concerned’ over Israel-Lebanon conflict escalation

12:24 , Salma Ouaguira

An escalation in fighting between Israel and Lebanese militant group Hezbollah is “extremely concerning”, Downing Street has said.

The prime minister’s official spokesman told reporters: “We are deeply concerned about the situation and the risk of further escalation and destabilisation.

“I think as the PM has said before, the situation on the northern border of Israel is extremely concerning, and we’re calling on all parties to de-escalate.

“We urge both the Israeli and Lebanese governments to engage with the US-led discussions to reach a political settlement and resolve these tensions diplomatically.”

The official said he did not have an update and would not get into military movements when asked about a report that British navy ships on their way to the region may help a potential evacuation operation from Lebanon.

It comes as Israeli drone attacks have reportedly killed two people people in southern Lebanon in response to the strike in Israeli-occupied Golan Heights.

Extinction Rebellion activists block road to Westminster

12:15 , Salma Ouaguira

A group of climate activists have blocked a road in central London in a protest targeting the office building of think tank Policy Exchange.

The members of Extinction Rebellion (XR) held banners bearing the words “Policy Exchange – cut the ties to fossil fuels”, blocking access to Old Queen Street in Westminster this morning.

Leaflets given out at the demonstration listed the group’s demands, including “full and open disclosure” of where funding for the think tank comes from, increased transparency of Policy Exchange meetings with MPs and government departments, and the removal of charitable status for “any lobby group” that receives money from “big oil and gas”.

The group poured pools of black liquid outside the Policy Exchange building alongside a yellow sign reading “Caution: slippery with the truth”.

Watch: Migrant’s message for Rishi Sunak as small boat heads for English Channel

12:14 , Salma Ouaguira

Migrant’s message for Rishi Sunak as small boat heads for English Channel

Lord Heseltine has Tory whip restored after backing Lib Dems over Brexit in 2019

12:07 , Salma Ouaguira

Former deputy prime minister Lord Heseltine quietly had the Tory whip restored earlier this month after five years

The veteran MP was suspended in May 2019 after saying he would vote for the Liberal Democrats at the European elections.

On July 9 2024, the Conservative Party restored the whip to Lord Heseltine, public records show.

A total of 21 MPs had the Conservative whip suspended in September 2019, after rebelling against the government in a bid to avoid a no-deal Brexit.

Our political correspondent Millie Cooke has the full story:

Lord Heseltine has Tory whip restored after backing Lib Dems over Brexit in 2019

Badenoch: Tories ‘deserved to lose’ election because of ‘incoherent’ policy

11:59 , Salma Ouaguira

Tory leadership hopeful Kemi Badenoch has claimed her party “deserved to lose” the general election because the cabinet, which she was part of, put forward an “incoherent” policy.

The shadow business secretary became the sixth candidate to declare she is standing to replace Rishi Sunak following Tom Tugendhat, James Cleverly, Mel Stride, Priti Patel and Robert Jenrick.

The bookmakers’ favourite told the Times: “The electorate did not make a mistake. We deserved to lose because the past decade saw us twist and turn in the wind, unsure of who we were, what we were for and how we could build a new country.

“Some will argue our loss was down to this policy, that person or some decision. The truth is our policy offer was incoherent, and we could not articulate why conservatism should matter to our fellow man. We thought we could just be managerially better at governing than the other side – a weak foundation at the best of times. Too often, we were led by focus groups.”

Suella Braverman vows to back new Tory leader from backbenches

11:50 , Salma Ouaguira

IFS: Labour ‘pretty likely’ to raise taxes in some form

11:45 , Salma Ouaguira

Director of the Institute for Fiscal Studies Paul Johnson said that it is “pretty likely” Labour would raise taxes in some form as the party battles to fill the shortfall left by the Tories

Mr Johnson suggested the £20 billion hole could be plugged “by reversing the national insurance cuts Jeremy Hunt made in his last two budget statements”.

He told Times Radio: “If it weren’t for the politics, that would be the most straightforward thing to do.”

Other economists claimed the government could also “raise a few billion pounds from reforms to capital gains tax and inheritance tax”.

Pound weakens as Reeves set to reveal public finances shortfall

11:42 , Salma Ouaguira

The pound has weakened against the US dollar as investors showed caution ahead of the chancellor’s announcement addressing a £20 billion public spending black hole, and the Bank of England’s upcoming interest rate decision.

Sterling’s value dipped by 0.4% against the US dollar on Monday morning, at about 1.281, hitting a new near three-week low.

The pound was also down about 0.15% against the euro at 1.1835, suggesting some caution among traders.

Currency movements typically indicate the reaction of financial markets to events that could impact the wider economic landscape.

Investors also reacted to expectations that the Bank of England could decide to cut interest rates on Thursday for the first time in more than four years.

Financial markets are more or less split over whether policymakers will decide it is the right time to reduce rates or wait until later in the year.

Economists also stressed that the decision could be a close call, with the Bank wanting to be certain that inflation is under control before it can start to ease monetary policy.

Breaking: High Court rules Tories’ ban on puberty blockers lawful

11:40 , Salma Ouaguira

A ban on puberty blockers introduced by the Conservative government with emergency legislation was lawful, the High Court has ruled.

Campaign group TransActual, and a young person who cannot be named, made a bid to challenge the decision of now-shadow health secretary Victoria Atkins to impose a so-called “banning order” on puberty blockers, which suppress the natural production of sex hormones to delay puberty.

At a hearing on July 12, the High Court in London heard the secondary legislation prevents the prescription of the medication from European or private prescribers and restricts NHS provision to within clinical trials.

Lawyers for the group and young person had argued that the order made by the previous government on May 29 was unlawful.

The Department of Health and Social Care (DHSC) and the Department of Health in Northern Ireland defended the claim and said the case should be dismissed.

In a ruling on Monday, Mrs Justice Lang dismissed the challenges.

She said: “This decision required a complex and multi-factored predictive assessment, involving the application of clinical judgment and the weighing of competing risks and dangers, with which the court should be slow to interfere.”

The legislation came after the publication of the long-awaited Cass Review by Dr Hilary Cass into children’s gender services in the NHS, which said children have been let down by a lack of research and evidence on the use of puberty blockers and hormones

Mortgage approvals for house purchase steady in June, says Bank of England

11:34 , Salma Ouaguira

The number of mortgage approvals made to home buyers remained “broadly stable” in June, according to the Bank of England.

Some 59,976 mortgages for house purchase got the green light, compared with 60,134 in May.

The Bank of England’s Money and Credit report said: “Net mortgage approvals (that is, approvals net of cancellations) for house purchases, which is an indicator of future borrowing, remained broadly stable at 60,000 in June.”

The base rate has remained at 5.25% since August last year.

But with inflation hitting the 2% target level for the past two months, hopes have been raised that rates can start to be reduced, perhaps as early as Thursday, easing the pressure on borrowers.

In full: Keir Starmer rejects post-Brexit youth mobility scheme with Spain

11:27 , Salma Ouaguira

Labour has rejected a free movement deal for young people with Spain after the country’s prime minister floated the idea with Sir Keir Starmer.

The government repeated the prime minister’s promise not to take Britain back into the single market, customs union or restore freedom of movement.

“And we are not considering a youth mobility scheme,” a government spokeswoman said.

Our political correspondent Archie Mitchell has the full story:

Keir Starmer rejects post-Brexit youth mobility scheme with Spain

Lammy speaks to Lebanese PM amid rising tensions with Israel

11:15 , Salma Ouaguira

David Lammy has spoken to Lebanese prime minister Najib Mikati following the Golan Heights attack.

A rocket struck a football field in the Druze town of Majdal Shams on Saturday, killing 12 children and teenagers.

Israel accused Hezbollah of being behind the attack, but the Lebanese militant group denied responsibility, which has raised fears of a potential escalation of fighting in the region.

The foreign secretary said: “I spoke to prime minister Najib Mikati today to express my concern at escalating tension and welcomed the government of Lebanon’s statement urging for cessation of all violence.

“We both agreed that widening of conflict in the region is in nobody’s interest.”

Labour rejects claims Reeves set to announce cuts to public spending

11:02 , Salma Ouaguira

Labour MP Torsten Bell, who is Pat McFadden’s private secretary, has dismissed claims that Rachel Reeves’ announcement will unveil cuts to public spending.

The former Resolution Foundation think tank chief tweeted: “Public service notice (given lots of confused coverage this morning): you’re not ‘cutting public spending’ if you’re not changing any budgets but instead revealing that the previous government announced transport schemes without the budgets to make them happen.”

How could Labour raise taxes?

10:58 , Salma Ouaguira

With Rachel Reeves set to unveil a £20 billion ‘black hole’ in public finances today, there are rumours that Labour’s first autumn statement will bring new tax raising measures. The party says it will better manage existing resources to cut costs, as well as attract investment from the private sector to help finance some public projects.

But it is now likely that the government will look to new ways to raise revenue. Here are some of the key measures they could implement in the autumn statement:

• Taxing pensions savings: Pension tax relief is a reduction on the amount of tax paid on private pensions. It helps workers save for retirement by boosting their pension pots. The measure would raise around £3 billion a year, with 7 million earners paying more tax. But it would be better news for basic rate earners, who would actually begin receive a 10 per cent boost to their pension contributions.

• Closing Inheritance Tax loopholes: Inheritance Tax is a levy on the estate of someone who has died. This is their property, money and possessions. Crucially, it is not paid if the value of these things are below £325,000. The economic think tanks said ending these measures alone would raise £4.8 billion a year by 2029.

• Changing Council Tax: Council tax is a local tax which provides funding for the local authority to which it is paid. The amount will vary by area, but can range from £1,500 a year to upwards of £4,000 depending on area and property value.

• Raising Capital Gains Tax: Capital Gains Tax (CGT) is paid on the profit made when an asset that has increased in value is sold. It is applies to things like the sale of personal possessions worth more than £6,000 (apart from a car), property that’s not the seller’s main home, shares and business assests. It is charged at 10 or 18 percent for basic rate taxpayers, and 20 or 24 for higher or additional rate earners. There is a tax-free allowance of £3,000.

Reeves to axe projects to fix £20bn black hole in finance review

10:50 , Salma Ouaguira

The chancellor is expected to unveil billions of pounds worth of cuts to plug the gap in public finances.

Rachel Reeves will announce the cancellation of multiple nationwide projects in roads and rail sector, and a spending reduction on external consultants.

The plans will see the Treasury scrapping large infrastructure developments including the £500 million Restoring Your Railway Fund, the £1.7 billion A303 dual carriageway Stonehenge by pass and the A27 Arundel bypass in West Sussex.

In a speech in the Commons, Ms Reeves will say: “It is time to level with the public and tell them the truth.

“The previous government refused to take the difficult decisions. They covered up the true state of the public finances. And then they ran away. I will never do that.”

Labour: Tories left UK finances in worst state since Second World War

10:42 , Salma Ouaguira

Poll: Two thirds believe UK economy is in a bad state

10:35 , Salma Ouaguira

According to a new YouGov poll, almost tow-thirds of people in the UK think the economy is in a bad state.

The survey, conducted between 19-22 July found a whopping 64 per cent of voters had a negative view of the state of the economy.

And only one in ten people had a positive assessment.

Whittle becomes second contender for Scottish Tory leadership

10:27 , Salma Ouaguira

MSP Brian Whittle has become the second candidate to declare in the race for the Scottish Tory leadership.

Mr Whittle – a former Olympian sprinter – announced his plans to stand to replace Douglas Ross on Monday.

Writing in the Scotsman, the West of Scotland MSP leaned heavily on his sporting background, saying the leadership contest was “when we decide how we pick ourselves up and prepare for the next race”.

His announcement follows fellow MSP Russell Findlay throwing his hat into the ring last week.

Mr Ross announced in the middle of the General Election campaign he would quit after polling day, following backlash over his decision to stand in the stead of former MP David Duguid – who party bosses deemed too ill to run.

Announcing his intentions, Mr Whittle said the party had “never been a serious contender” to take over in Scotland in the 25 years of the Scottish Parliament.

“We can do better than that,” he added. “As a party we must be more pro-active. It is not enough to respond to events. We must shape them.”

His candidacy, he said, has three “core principles” – education, enterprise and empowering people.

Shadow secretary mocks Reeves’ £20billion black hole claim

10:20 , Salma Ouaguira

Shadow science secretary Andrew Griffith has attacked Labour’s claim about a £20billion black hole in public finances left by the Tories.

The Conservative MP for Arundel and South Downs tweeted:

Minister meeting charity over ‘scandal’ of Carer’s Allowance overpayments

10:13 , Salma Ouaguira

The Government has promised a plan to “put things right” on overpayments to carers which have led to many unwittingly racking up unmanageable levels of debt and some quitting their jobs as a result.

The issue of people being penalised for going over their earnings limit for Carer’s Allowance even by as little as a few pence per week has been branded a “scandal” by a charity.

Carers UK said some people have been left owing “hundreds, thousands and sometimes tens of thousands of pounds” to the Department for Work and Pensions.

The organisation said “many carers” had told them they felt they had to leave their employment as a result of receiving an overpayment and “many more” had reduced their hours and turned down pay rises amid fears of breaching the earnings limit.

The charity has called for “concrete changes” to the system, including a rise in the earnings limit for the allowance, for debts to be written off in certain cases, and for clearer information and communication with carers.

A Government report written in 2021 but only published in May this year suggested 3% of their sample of claimants had received an overpayment of carer’s allowance.

With about 1.3 million people receiving carer’s allowance, the Carers Trust charity said this could equate to tens of thousands of people having been overpaid.

Then-work and pensions committee chairman Sir Stephen Timms said the issue had caused people “distress” and the report called on the Government of the time to “get a grip of the problem”.

On Monday, Carers UK said it was meeting with Sir Stephen to present its report into the devastating impacts of the issue.

Labour denies plans for EU freedom of movement for young people

10:07 , Salma Ouaguira

Sir Keir Starmer reportedly discussed the possibility of a youth mobility scheme with the Spanish prime minister Pedro Sánchez.

Mr Sánchez raised the proposal to Starmer in a bilateral meeting during the European Political Community summit earlier this month.

Under the plans, young people aged between 18 and 30 would be granted free movement for up to four years allowing them to live, study or work in the EU.

But Downing Street has now denied that the government is considering such scheme insisting the UK will not reintroduce freedom of movement.

A government spokeswoman said: “We have been clear that we won’t rejoin the single market, customs union or reintroduce freedom of movement, and we are not considering a youth mobility scheme.”

VOICES: I wish Cameron had heeded my warnings about leaving the ECHR

10:03 , Salma Ouaguira

As the Conservative leadership race gets underway, candidates appear hidebound to promise to withdraw the UK from the body that guarantees fundamental human rights in law.

To do so would be wildly irresponsible – and only help keep the Tories out of power, says former attorney general Dominic Grieve:

Cameron fired me over my support for the ECHR – but he should have listened to me

Richard Tice: Labour black hole claim is a ‘con’

09:58 , Salma Ouaguira

The Reform UK deputy leader has slammed Labour’s claims about a £20 billion black hole in public finances left by the Tories.

The MP for Boston and Skegness said the government knew about the state of the finances during the general election campaign and accused the cabinet office of “flip flopping” on pledges.

Taking to social media, he said: “Labour black hole con: The numbers were known, the promises were made. Now Labour doing what Labour does: fiddle the books, flip flop on pledges. Just like Tories.”

Plans for a new ‘Office for Value for Money’ to be revealed

09:55 , Salma Ouaguira

Rachel Reeves is set to unveil fresh plans to establish a new “Office for Value for Money” during her speech in the Commons today.

According to the Treasury, the new body will provide “targeted scrutiny of public spending, so that value for money governs every decision government makes”.

No 11 said it the Office would use pre-existing civil service staff to put an end to “wasteful spending” in government.

The department said: “The Office will immediately begin work on identifying and recommending savings for the current financial year, while also establishing where targeted reforms of the system can ensure that poor value for money spending is cut off before it begins.”

McFadden claims GPs ‘cornerstone’ of NHS amid strike threats

09:45 , Salma Ouaguira

Pat McFadden has said GPs are the “cornerstone of the NHS” as the doctors’ union threatens the government with industrial action.

The chancellor of the Duchy of Lancaster said the Wes Streeting had met with BMA’s chiefs of the GP committee three times since becoming health secretary.

He told the BBC Radio 4 Today programme: “They’re the cornerstone of the NHS. They are the first people that patients see when they fall ill so they perform a hugely important task for the country.”

He added: “We are very keen across all these industrial disputes in the NHS, to get the NHS back to working normally again, to serving the public.

“We turned around the NHS, before the last time we were in government, we can do so again. It’s going to be a long project, but we want to begin by getting it working normally. Again.”

Reeves expected to approve inflation-busting pay hikes for public sector workers

09:37 , Salma Ouaguira

Rachel Reeves is expected to approve above-inflation pay rises for millions of public sector workers next week, amid concerns over the cost of further industrial action if the government refuses.

The chancellor is set to respond to the recommendations of independent pay review bodies today, when she will also argue in parliament that the Tories left Labour with a dire spending inheritance, including a £20 billion black hole.

She could reportedly also announce delays to a string of major capital projects to plug the shortfall.

Teachers and some 1.3 million NHS staff could be in line for a 5.5% pay boost, which could cost about £3.5 billion more than had been budgeted for.

Economists believe this could rise to about £10 billion if other pay review bodies give similar advice on workforces such as police and prisons officers and doctors and dentists.

Sir Keir Starmer has previously acknowledged there would be a cost if failing to follow the recommendations of the pay review bodies led to a fresh wave of industrial disputes in the public services.

Shadow minister hits out at Braverman for Tory ‘infighting’ under Sunak

09:27 , Salma Ouaguira

Shadow minister Helen Whately has said she is “glad” the Tories decided to a start a “relatively long leadership process”.

The MP for Faversham and Mid Kent said the move will allow candidates to “talk about what their vision is for the country, talk about how they want to solve some of the challenges that we face, seize the opportunities set out their vision for aspiration, opportunity, and also how if they have the opportunity to be prime minister in future”.

Asked whether she would have backed Suella Braverman if she went ahead with her bid, she said: “I haven’t declared who I’ll be backing, though I do know that I wouldn’t have backed Suella.”

Ms Whately added she wouldn’t describe the ex-home secretary as “dangerous” but there was “too much infighting” in the Tory party, and Mrs Braverman “did speak up very vocally against Rishi Sunak when he was prime minister”.

Home Secretary urged to reverse peaceful protest crackdown

09:16 , Salma Ouaguira

Groups representing human rights and green issues are urging the Home Secretary to “reverse the crackdown” on peaceful protests.

An open letter – signed by 92 organisations including Amnesty International UK, Greenpeace UK, Liberty and Christian Aid – was sent to Yvette Cooper.

It comes after five Just Stop Oil protesters were handed four and five year-prison sentences for their involvement in a protest that disrupted the M25 in London for more than four days in 2022.

The jail terms, which are thought to be the longest sentences ever given in the country for peaceful protest, have been condemned by many including UN human rights commissioner Volker Turk – who described them as “deeply troubling”.

Writing to Ms Cooper, the groups said the sentences are not an isolated incident but the result of a “deliberate strategy by previous governments to criminalise and shrink the space for peaceful protest in our democracy”.

They said the new Labour government now faces “a clear choice between allowing its dire consequences to play out under its watch, or do something to prevent it”.

The signatories cited the Police, Crime, Sentencing and Courts Act 2022 and the Public Order Act 2023 as two pillars of the Tory government’s strategy, describing them as “gagging laws”.

They also criticised previous attorney generals for removing legal defences available to peaceful protesters, adding that this has led to “the absurd situation of juries being prevented from hearing crucial evidence from defendants about the reasons for their actions”.

Government leaves door open to tax rises ahead of chancellor’s speech

09:01 , Salma Ouaguira

Pat McFadden has left the door open to tax rises as Rachel Reeves prepares to deliver a speech on £20billion black hole in public finances.

The cabinet minister said that the chancellor’s statement would set out spending plans but he refused to rule out potential tax rises later this year.

He told Times Radio: “Today is not a Budget. People should not expect tax announcements today. We have said a number of things about tax during the election. We said that we wouldn’t increase income tax rates, National Insurance rates or VAT. Those things still hold.

“And we also said there was nothing in our plans at the election that required increases in taxes.

“That was the case during the election and today what you will hear is how we are going to have to respond to that opening of the books and I think what people should expect today is not tax measures but a Chancellor that is prepared to take some very tough decisions on spending to show that we put financial stability first and we take seriously that as the foundation for growing the economy.”

Reeves says previous government ‘covered up’ financial turmoil

08:52 , Salma Ouaguira

Britain’s new Treasury chief is alleging that the previous government covered up the dire state of the nation’s finances, as she prepares to deliver a major speech to Parliament on Monday that is widely expected to lay the groundwork for higher taxes.

In extracts of her speech released late Sunday, Rachel Reeves professed shock at the scale of the problems she discovered following a department-by-department review of public spending commissioned shortly after she took office three weeks ago.

While the excerpts included no figures, Reeves is expected to outline a 20 billion-pound ($26 billion) shortfall in public finances.

“It is time to level with the public and tell them the truth,’’ Reeves will tell the House of Commons. “The previous government refused to take the difficult decisions. They covered up the true state of the public finances. And then they ran away.’’

During Sir Keir Starmer ’s  campaign, critics accused both parties of a “conspiracy of silence” over the scale of the financial challenges facing the next government.

UK’s new Treasury chief says previous government ‘covered up’ financial turmoil ahead of election

McFadden: Growth is the challenge for the country

08:44 , Salma Ouaguira

The government’s growth mission can only be built on stable economic foundations, Pat McFadden has said.

It was put to the cabinet office minister on BBC Radio 4’s Today programme that stalling or cancelling infrastructure projects would not aid economic growth.

He replied: “Growth is the challenge for the country. Growth is the mission for the country.

“We will have more to say about that later this week – for example, when we talk about how we are going to get housebuilding moving again with all the positive repercussions that has for the economy.

“In everything that we do and everything that the chancellor sets out later this afternoon, the priority of growth is there.

“But let me say something else about growth. We also always said that the foundation for growth was fiscal responsibility and stable public finances. That is why we talk about fixing the foundations, that is why we have to be candid with the public about the situation that we have inherited after the general election.”

Tory leadership nominations close at 2.30pm today

08:37 , Salma Ouaguira

Nominations in the Tory leadership race will close this afternoon with six names expected to make it onto the ballot paper.

Under rules drawn up by the 1922 Committee of Tory MPs and the party board, nominations close at 2.30pm today.

Kemi Badenoch was the lates to throw her hat in the ring and Suella Braverman has withdrawn her bid.

The shadow business secretary joins Dame Priti Patel, Mel Stride, Tom Tugendhat, James Cleverly and Robert Jenrick to compete for the top job.

Reeves vows to ‘fix foundations’ and ‘rebuild UK economy

08:30 , Salma Ouaguira

High Court to rule whether emergency puberty blocker ban was lawful

08:23 , Salma Ouaguira

The High Court is set to rule on whether an emergency ban on puberty blockers made by the Tory government was lawful.

Campaign group TransActual, and a young person who cannot be named, made a bid to challenge the decision of now-shadow health secretary Victoria Atkins to impose a so-called “banning order” on puberty blockers, which suppress the natural production of sex hormones to delay puberty.

At a hearing on July 12, the High Court in London heard the secondary legislation prevents the prescription of the medication from European or private prescribers and restricts NHS provision to within clinical trials.

The Department of Health and Social Care (DHSC) and the Department of Health in Northern Ireland are defending the claim and have said the case should be dismissed.

Mrs Justice Lang is due to give her decision on the claim in writing today.

Although the emergency ban was implemented by the previous Conservative government, the court heard that it might be made permanent by new Labour ministers.

Health Secretary Wes Streeting later said he was “treading cautiously” in his decision amid “lots of fear and anxiety”.

Conservatives hit back at Labour’s £20bn black hole claim

08:18 , Salma Ouaguira

Rachel Reeves could raise £10bn in wealth taxes, think tank says

08:17 , Salma Ouaguira

Rachel Reeves could raise £10bn a year in wealth taxes as she looks to plug a massive hole in the public finances left by the Conservatives, according to a new report.

The left-leaning Resolution Foundation think tank says the chancellor could find the cash to fund Labour’s plans for power, including inflation-busting pay hikes for public sector workers, by levying taxes on unearned wealth.

The report identifies Britain as a nation of “booming wealth” but “busted wealth taxes”, and sets out how taxing the richest could be the key to raising funds.

It comes ahead of a major speech by the chancellor in which she will blame Rishi Sunak’s government for Labour’s dire economic inheritance. She is expected to point to a series of unfunded spending commitments and identify a £20bn gap in current plans.

Our political correspondent Archie Mitchell has the full story:

Rachel Reeves could raise £10bn in wealth taxes, Resolution Foundation says

Who will be the next Conservative leader? The Tory frontrunners

08:14 , Salma Ouaguira

The Conservatives have kicked off a leadership contest after Rishi Sunak led the party to its worst election defeat in history.

A string of senior figures have thrown their hats in the ring to succeed the former PM and lead the party through the next five years in opposition.

With the shortlist to be whittled down gradually until a final four are paraded in front of the party faithful at October’s Tory conference, The Independent looks at the runners and riders to take the reins from Mr Sunak.

Who will be the next Tory leader? The Tory frontrunners from Patel to Braverman

Labour could back Israel’s invasion in Lebanon under self-defence grounds

08:13 , Salma Ouaguira

An escalation in fighting between Israel and Lebanese militant group Hezbollah could be “much more serious” than the war in Gaza, Pat McFadden has said.

Asked about the possibility for escalation in the conflict, the Cabinet Office minister told Sky News: “I think this is very serious. Since October 7 last year, we have all been focused on the situation in Gaza between Israel and Hamas.

“We have known that there is this other situation in northern Israel between Hezbollah and Israel, and that has the potential to be a much more serious situation than even the one that we have been watching unfold in Gaza over the last 10 months.”

Asked if the Government would support an Israeli ground invasion against Hezbollah, Mr McFadden said: “We will always argue for Israel’s right to defend itself, but we hope in this situation that cooler and calmer heads will prevail and we do not see a full-scale conflict between Israel and Hezbollah.”

Chancellor’s ‘honest’ speech on finances will not lead to austerity – Labour MP

08:10 , Salma Ouaguira

A Scottish Labour MP has denied the Chancellor’s expected speech on a £20 billion black hole in the public purse will lead to austerity.

Chancellor Rachel Reeves is expected to set out the state of the spending shortfall in a speech to the UK Parliament on Monday, with reports suggesting key hospital and road building schemes could be cut.

But newly elected East Renfrewshire MP Blair McDougall denied there would be severe public spending cutbacks.

He was asked on BBC Scotland’s The Sunday Show programme whether there would be a return to austerity following the Chancellor’s speech.

He said: “No, I don’t think we are (returning to austerity). I think we’ve said in the election, and you’ll see from Rachel being clear about where it is we’re going to raise more money.”

He added: “I think Rachel deserves a lot of credit for trying to be honest with the public and saying exactly what the extent of the mess we’ve inherited is.

“People don’t think that things are going to be easy, they accept that change is going to take time but what they want to know is what is the direction of travel and how are we going to get there and the first step of that is about being honest.”

Badenoch launches Tory leadership bid as Suella Braverman withdraws from contest

08:04 , Salma Ouaguira

Kemi Badenoch has become the latest Conservative Party MP to enter the leadership race to replace Rishi Sunak.

The shadow housing secretary pledged to tell voters the truth as she launched her bid to become leader.

It comes as former home secretary Suella Braverman announced she had pulled out of the race because the “traumatised” party was refusing to acknowledge the truth about why they lost the general election.

Ms Braverman said she had secured the backing of the 10 MPs required to get her over the threshold to enter the race.

But she added she had opted not to try for the leadership of the party after being “vilified” for her views on why they suffered such a drastic loss in the 4 July general election.

Kemi Badenoch launches Tory leadership bid as Suella Braverman withdraws from contest

David Lammy condemns Golan Heights strike

08:00 , Salma Ouaguira

The Foreign Secretary has condemned a rocket strike in the Israeli-controlled Golan Heights.

David Lammy tweeted: “The UK condemns the strike in Golan Heights that has tragically claimed at least 12 lives.

“We are deeply concerned about the risk of further escalation and destabilisation.

“We have been clear Hizballah must cease their attacks.”

The strike on Saturday, which the Israeli military said killed 12 children and teenagers, has raised fears that conflict could escalate in the Middle East.

Israel has blamed the Lebanese militant group Hezbollah, which has denied any role in the strike. The Israeli military said it struck targets inside Lebanon overnight.

French border control zone at Dover to be expanded ahead of new EU rules

07:53 , Salma Ouaguira

The French border control zone at the Port of Dover will be expanded to reduce the risk of queues at peak times when new EU rules come into force.

Under the EU’s Entry/Exit System (EES), expected to come into force in the autumn, travellers entering from the UK and other non-EU countries will have to register their details at the EU border and provide biometric data.

As the Government prepares for the change, Home Office Minister Seema Malhotra will lay a Statutory Instrument in Parliament on Monday to allow French border officials to operate in an expanded zone at the Port of Dover.

It will commit the Home Office to working with the French Government, local authorities and businesses to streamline EU border checks at the port.

The change in law is part of the preparations to minimise the risk of traffic disruption. The aim is to create more space to process passengers for a better customer experience.

The Home Office is working with the French Interior Ministry to amend the border control arrangements between the two countries to accommodate the expanded zone.

The port plans to change the location of passport control for passengers arriving to board the ferry from the Eastern Docks to a new border control zone at its Western Docks.

The port has also been making major upgrades to its port infrastructure, including building bespoke facilities to carry out the checks.

Labour: Rwanda cost £700 million ‘with more to be spent in the future’

07:49 , Salma Ouaguira

The Rwanda scheme has cost hundreds of millions of pounds more than previously announced, and is only one example of spending pressures the Chancellor will reveal on Monday, Pat McFadden has said.

The Cabinet Office minister told Sky News: “We were told that the Rwanda scheme was going to cost £400 million. We have now found that it is £700 million, with billions more to be spent in future.”

Tory government misled the OBR, Pat McFadden claims

07:41 , Salma Ouaguira

Pat McFadden has accused the last Conservative government of misleading the Office for Budget Responsibility (OBR) about the state of the public finances, Archie Mitchell writes.

The chancellor of the Duchy of Lancaster said Rachel Reeves will set out how the spending plans inherited by Labour are worse than what was set out by the OBR in March.

“It is worse than we thought during the election… the budgetary pressures this year are higher than those set out in the OBR forecast before the March budget,” Mr McFadden told Sky News.

Pressed over whether the last government misled the OBR, he said: “[Their forecasts] are going to have to be revised today because there are in-year pressures that the government didn’t tell us about.”

McFadden accuses Tories of ‘running away’ from black hole in public finances

07:31 , Salma Ouaguira

Pat McFadden has accused the previous Tories of “running away” from the £20 billion black hole in the government’s accounts.

He told Sky News: “We knew we were going to inherit a very difficult situation but what we have discovered since taking office a few weeks ago is that things were even worse that we thought.

“And the previous government was certainly guilty of running away from the situation.”

The chancellor of the duchy of Lancaster accused the Conservatives of lying about the real cost of the Rwanda scheme.

He added: “The government were emptying the country’s reserve to pay for other parts of their asylum policy in addition to that the education secretary had a pay offer for teachers that nobody knew about during the election.

“When you take all of this and add it all up it adds to a significant pressure on the budget this year which we have to react to. And that reaction will have to be set out by the chancellor this afternoon.”

IFS: Public spending blackhole equivalent to Tories’ pre-election national insurance cuts

07:20 , Salma Ouaguira

The scale of the blackhole in public spending which the government has warned of is equivalent to the Tories’ pre-election national insurance cuts, a think tank has said.

Paul Johnson, director of the Institute for Fiscal Studies, told BBC Breakfast: “It is very striking that if this problem is about £20 billion big that is exactly the scale of the national insurance cuts implemented by Jeremy Hunt just before the election.

“Now, if those cuts were implemented in the knowledge that there was this kind of hole that is not good policy to put it mildly.”

Reeves set to announce steps to cut government costs

07:02 , Tom Barnes

Chancellor Rachel Reeves is set to announce immediate steps to cut costs as she is expected to reveal a £20 billion black hole in the government’s accounts.

She will lay out the spending inheritance left by the previous government – and announce the date of her first autumn Budget – on Monday afternoon as she pledges to “restore economic stability”.

She will say that a Treasury spending audit she commissioned shows that the previous government overspent this year’s budgets by billions of pounds after making a series of unfunded promises.

Read more here:

Chancellor to announce cost-cutting steps as she pledges to fix public finances

Good morning

06:46 , Tom Barnes

Good morning and welcome to The Independent’s live politics coverage for Monday, July 29.

In case you missed it late yesterday evening, Kemi Badenoch has become the latest Conservative Party MP to enter the leadership race to replace Rishi Sunak.

The shadow housing secretary pledged to tell voters the truth as she launched her bid to become leader.

It comes as former home secretary Suella Braverman announced she had pulled out of the race because the “traumatised” party was refusing to acknowledge the truth about why they lost the general election.

You can read more here:

Kemi Badenoch launches Tory leadership bid as Suella Braverman withdraws from contest

No 10 refuses to confirm claims of 20 per cent pay rise offer to junior doctors

12:16 , Salma Ouaguira

Downing Street did not confirm or deny reports that junior doctors have been offered a 20% pay rise over two years in a bid to resolve the long-running pay dispute.

Asked about the report in The Times, the Prime Minister’s official spokesman told reporters: “As we’ve said before, we’re committed to working to find a solution, resolving this dispute, but I can’t get into detailed running commentary on negotiations.

“We’ve been honest with the public and the sector about the economic circumstances we face. But the Government is determined to do the hard work necessary to finally bring these strikes to an end.”

The official added the industrial action has been “hugely damaging both to patients and to the impact on the waiting lists and we’ve said we’re committed to finding a solution and resolving this dispute.”