Following the government’s U-tun on welfare reform, Labour’s spending plans simply don’t add up, says Karl Williams

After the government’s latest U-turn, the question on many lips is: how long can Keir Starmer and Rachel Reeves go on like this? But a more pertinent question might be: how long can the country go on like this?

Ever since Labour came to power, they have told us they were doing the tough, fiscally disciplined thing. But the climbdowns first on winter fuel payments, and now on welfare reform, blow multi-billion-pound holes in those numbers. Indeed, it can’t be said often enough that these welfare “cuts” were merely shaving £4bn off a predicted £30bn rise in the national incapacity bill.

So how to make the numbers add up? More borrowing can be an option – until the bond markets suddenly decide it isn’t (see Truss, Liz). So further tax rises are almost certainly on the cards for the autumn Budget, despite Labour’s pre-election pledges. Yet the tax burden........

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