Politics latest: Minister doesn't rule out raising employer national insurance (2024)

Key points
  • Reynolds won't rule out raising employer national insurance|But Tories says it would break Labour manifesto pledge
  • Explained:What is national insurance and what did Labour pledge at the election?
  • Minister defends transport secretary after comments nearly derailed £1bn investment
  • Beth Rigby:The verdict on Starmer's first 100 days is in - and it isn't good
  • King leads tributes to former Scottish first minister Alex Salmond who has died age 69
  • Connor Gillies: The shock of Salmond's death is reverberating around UK politics
In depth
  • Listen:The chancellor's £25bn problem
  • Explained:What are Labour's employment reforms?
  • Analysis:Unpredictable Tory contest is about to get spicy

16:00:01

That's all for today

Thank you for joining us in the Politics Hub for live coverage of today's political news.

Here are the headlines:

  • Speaking on Sky's Sunday Morning With Trevor Phillips, Business Secretary Jonathan Reynolds refused to rule out raising employer national insurance as a way to raise revenue to fund the government's spending pledges;
  • But shadow work and pensions secretary Mel Stride told us it would breach Labour's pledge not to raise national insurance and would be a "jobs tax";
  • The business secretary also defended his colleague, Transport Secretary Louise Haigh, who nearly derailed a £1bn investment on the eve of the government's big investment summit by criticising DP World's P&O Ferries following the fire and rehire scandal;
  • The summit is due to kick off tomorrow morning, and Sky's City editor Mark Kleinman has revealed that the government will unveil over £50bn of deal announcements - roughly twice the £28bn unveiled at the previous comparable gathering held under the former Conservative administration;
  • Tributes were paid from across the political spectrum to the Scottish political titan Alex Salmond, who died yesterday at the age of 69.

Join us again for the very latest from Westminster as the government hosts business leaders for its flagship investment summit.

15:46:51

Tory peer predicts another leadership race in two years - as frontrunners show they 'make mistakes'

Conservative peer Ruth Davidson has said she thinks there is a "good chance" there will be another Tory leadership election in two years - despite the fact one is currently under way.

Baroness Davidson told Beth Rigby on the Electoral Dysfunction podcast that the recent Conservative Party conference showed that both Kemi Badenoch and Robert Jenrick, who have made the final two, can "make mistakes".

The former leader of the Scottish Tories also revealed she voted for James Cleverly, the former home secretary and foreign secretary who was knocked out of the race on Wednesday amid accusations of vote lending.

Baroness Davidson said she thought it was likely that Mr Cleverly would receive a job in the shadow cabinet.

Listen to the full podcast at the top of the page

15:26:17

UK joins allies to 'strongly condemn' attacks on peacekeepers in Lebanon

The UK has joined 34 fellow countries that contribute to UN peacekeeping forces to "strongly condemn recent attacks" by Israel on the troops in Lebanon.

The British government has joined countries such as Poland, France, Finland, and the Netherlands to call on Israel to stop any such attacks that put troops from theUnited Nations Interim Force in Lebanon (UNIFIL) at risk "immediately", and calls on all parties to respect the presence of peacekeepers in the area.

In a post on X, Middle East minister Hamish Falconer added: "UNIFIL's role is crucial given the escalating situation in the region.

"Alongside allies and partners we condemn the recent attacks on its peacekeepers.

"These attacks must stop immediately and international humanitarian law must be respected."

Follow the latest on the crisis in the Middle East in our dedicated live blog here:

14:50:34

What are Labour's fiscal rules and could Reeves change them to raise more money?

By Alix Culbertson, political reporter

Chancellor Rachel Reeves will deliver her first budget at the end of October, providing the first chance for her to change the fiscal rules.

Upon entering government in July, the government said the Conservatives left it with a £22bn black hole, so the chancellor is expected to use the 30 October budget to raise some of that.

Ms Reeves said in November, when asked if she would consider changing the debt target, she was "not going to fiddle the figures or make something to get different results".

However, she is being urged to alter the rules to let the government access £57bn, according to the Institute for Public Policy Research (IPPR) thinktank.

And during Prime Minister's Questions on 9 October, Sir Keir Starmer refused to answer if he agreed with the chancellor's November statement, prompting some to speculate the government may change the fiscal rules.

Below, Sky News looks at what a fiscal rule is, what the Labour government's rules are and how they could change.

14:15:26

Memorial service held for Alex Salmond in North Macedonia where he died

Scotland's first minister has described Alex Salmond as a "hugely important" figure in Scottish and UK politics - joining the King and Succession star Brian Cox in paying tribute following his sudden death.

John Swinney praised the former Scottish leader's work as an MSP, telling Sky News'Sunday Morning With Trevor Phillips: "He made a colossal contribution to Scottish politics."

Mr Salmond diedon Saturday afternoonaged 69 from a suspected heart attack during a trip to North Macedonia.

Mr Swinney credited Mr Salmond for taking the Scottish National Party from the "fringes of Scottish politics to becoming the government of Scotland" and taking the country "incredibly close" to independence with the 2014 referendum.

In Ohrid, North Macedonia, a memorial service was held for Mr Salmond attended by President Gordana Siljanovska Davkova.

The former first minister was in the country to attend and speak at the Institute for Cultural Diplomacy Forum. He is understood to have collapsed at lunch in a crowded room after his speech.

Mark Donfried, director of the Academy for Cultural Diplomacy, was at the conference and said Mr Salmond seemed in the "best of spirits" during the meal.

"All of a sudden he just went out and fell into the arms of a colleague of mine on the other side of the table," he said.

"I immediately got up and ran to call an ambulance and when I came back, he was on the floor.

"We're all completely shocked - the entire hotel, the conference, it's been very difficult for all of us. Last night, we had a brief moment of reflection on his legacy."

13:45:01

Starmer's saviour? Insiders lift the lid on Morgan McSweeney, the PM's new closest confidante

By Alexandra Rogers, political reporter

When Morgan McSweeney met special advisers on Tuesday evening, he is said to have made a "pitch perfect" speech that rallied the troops after a bruising few weeks.

A source in a government department said the chatter after the meeting was all "about Morgan's appearance".

"He acknowledged that being a spad has been more like a nightmare than a dream job. It seemed to go down well but of course they want action, not just words."

The unhappiness in Labour ranks among special advisers - political appointees who support ministers - over their pay was just one of the rows that culminated in the downfall of Sue Gray, the former partygate investigator whom Sir Keir invested so much personal stock in hiring.

She now finds herself as Sir Keir's special envoy for the nations and regions, where she is not only expected to lose the £170,000 pay packet she was on - and which was leaked to the media in a successful attempt to damage her politically - but the unparalleled access she enjoyed to the prime minister.

For some, Mr McSweeney's reappointment as chief of staff is the precise rescue remedy the party needed after its first 100 days in power were marred by the row over freebies and donations, sending Sir Keir's personal ratings plummeting.

13:15:01

Labour's approval ratings drop as party reaches 100 days in government

Today marks Sir Keir Starmer's 100th day in the office of prime minister.

Ahead of the landmark date, pollsters at YouGov asked the public for their thoughts on the new administration.

It will not make pretty reading inside Number 10.

So far, 59% of people disapprove of the Labour government's record - just 18% approve.

Some 39% of the public say the country is worse off now than it was under the Conservatives.

The dire results contrast with much more positive numbers before the election.

On specific policies, releasing prisoners early to ease pressure on prisons and means testing the winter fuel payment are the most unpopular.

It's not just YouGov's numbers that are grim for Labour.

Ipsos also asked the public for their thoughts on the prime minister personally.

Just 26% are favourable towards Sir Keir - a fall of six points from last month - while 52% are unfavourable, an increase of eight points.

The feeling towards the Labour Party as a whole is similar.

But people still feel more favourable towards the government than the Tories (24%), though they have the same level of unfavourables.

Keiran Pedley, director of politics at Ipsos, says the figures will make "difficult reading" for the Labour leadership.

"With six in 10 not confident in Labour's long-term economic plan, the pressure is on for the coming budget to land well, with Labour facing significant political risk if it doesn't."

12:44:52

National insurance: What did Labour promise at the election?

As the budget approaches, rumours are swirling about what Labour plans to do in order to raise revenue and invest to both fix public services and grow the economy, as they have pledged.

The new administration has left itself little room to manoeuvre, but one measure that could be on the cards is raising employer national insurance.

What is national insurance?

National insurance contributions (NICs) are a form of tax - the second-biggest tax in the UK in fact, expected to raise just under £170bn in 2024/25, which is around a sixth of all tax revenue.

They are paid by employees, people who are self-employed, and by employers on the earnings of their employees.

NICs are not paid up to a certain threshold, and those thresholds vary.

Contributions are not charged on other forms of income, such as savings, property, or pensions - unlike income tax.

What did Labour promise in their manifesto?

Labour addressed national insurance in its manifesto for the July general election.

On page 21, the party said: "Labourwill not increase taxes on workingpeople, which is why we will notincrease national insurance, thebasic, higher, or additional ratesof income tax, or VAT."

However, the party is not explicit anywhere about employer national insurance.

Would raising employer national insurance breach the manifesto?

It depends on how you interpret the line from the manifesto above.

Business Secretary Jonathan Reynolds told Sunday Morning with Trevor Phillips thattheir promise not to increase national insurance was specifically "a reference to employees".

He also refused to rule out the move, and his comments are the clearest indication yet that such a rise is being considered.

But the Tories - which labelled employer NICs a "tax on jobs" - say it would break their manifesto pledge.

Shadow work and pensions secretary Mel Stride toldSunday Morning with Trevor Phillipsit would be "an absurdity" to argue that employer national insurance does not fall under Labour's pledge not to raise national insurance.

11:52:13

Starmer to hail more than £50bn in investment at flagship summit

By Mark Kleinman, City editor

The government will on Monday welcome more than £50bn of investment in the British economy as Sir Keir Starmer tries to reset his administration after a first hundred days marked by scandal and infighting.

Sky News has learnt that the International Investment Summit in the City of London will comprise more than £50bn of deal announcements – or roughly twice the £28bn unveiled at the previous comparable gathering held under the former Conservative administration.

The total figure to be announced on Monday was still being finalised this weekend amid continuing negotiations with companies - but sources said that the final amount would "certainly" be in excess of £50bn.

The summit will be attended by executives from globally important companies such as Alphabet, BlackRock, Goldman Sachs and Deepmind.

Sky News can also reveal that the summit will include a behind-closed-doors session chaired by the business secretary, Jonathan Reynolds, and a number of chief executives.

The group will, according to insiders, jointly scrutinise a green paper on industrial strategy that will also be published on Monday.

One invitee said they had been "asked to mark the government’s homework".

A source close to Mr Reynolds said: "When the business secretary said this government would work in partnership with business, he meant it.

"We respect the expertise of business leaders and want their voice at the heart of policymaking."

The event is being seen as a test of Labour’s economic agenda in the eyes of investors which wield influence over the destination of trillions of pounds of investment funding.

Officials declined to comment on Sunday on the headline figures that would be announced at the summit.

11:38:15

Tory peer predicts another leadership race in two years - as frontrunners show they 'make mistakes'

Conservative peer Ruth Davidson has said she thinks there is a "good chance" there will be another Tory leadership election in two years - despite the fact one is currently under way.

Baroness Davidson told Beth Rigby on the Electoral Dysfunction podcast that the recent Conservative Party conference showed that both Kemi Badenoch and Robert Jenrick, who have made the final two, can "make mistakes".

The former leader of the Scottish Tories also revealed she voted for James Cleverly, the former home secretary and foreign secretary who was knocked out of the race on Wednesday amid accusations of vote lending.

Baroness Davidson said she thought it was likely that Mr Cleverly would receive a job in the shadow cabinet.

Listen to the full podcast at the top of the page

Politics latest: Minister doesn't rule out raising employer national insurance (2024)
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