Budget 2024 live news: Minimum wage to rise as Reeves pledges millions for NHS appointments

The NHS faces “real problems this winter”, the health secretary has admitted as he refused to rule out the prospect of people waiting on trolleys and in corridors over the coming months.

Speaking on a joint visit to St George’s Hospital with chancellor Rachel Reeves, Wes Streeting said the extra money the health service is set to receive in Wednesday’s Budget might not prevent avoidable deaths and another winter crisis over the coming months.

The chancellor is expected to pump billions of pounds into the health service, including £1.5bn for new surgical hubs and scanners and £70m for radiotherapy machines.

Keir Starmer and his ministers have struggled to say who they mean by “working people” in the run up to Wednesday’s Budget.

But that did not stop the prime minister, doubling and tripling down on the term which got him through the election.

If Sir Keir does not know who they are he optimistically noted: “Working people know who they are.”

There was also an announcement of a £240 million fund to get people back into work – so more working people.

In truth though he is now echoing the words of his Tory predecessor Rishi Sunak. Sunak spent the months before the election saying he was making difficult “long term decisions”.

Now Starmer is talking about “tough decisions” not looking at the “short term sticking plasters”.

While though he wants a government for working people, the reality is that he is talking about record tax rises to cover as much as £40 billion in a black hole in his spending plans.

The reality is though that what happens now only matters for him in the way that voters see Labour in five years time. He is banking on pain now and better times later.

Most of all he is banking on economic growth. If he does not deliver then Labour will be facing trouble in 2029.

Rachel Reeves has warned that tomorrow’s Budget will just be the beginning of painful measures to fix “14 years of Tory damage”.

But with the prime minister also warning of “tough choices” ahead, Ms Reeves suggested that the expected tax rises this week will not be the end of difficult decisions to fix the country.

She has promised to produce economic growth but also pledged to her party that there will be “no new austerity”.

Ahead of the Budget on 30 October, there has been fevered speculation about changes to pension savers’ tax allowances and other perks.

Reports that pensioners could have tax breaks cut or axed led to savers withdrawing chunks of their retirement pots ahead of Chancellor Rachel Reeves’s big announcement.

Former chancellor Jeremy Hunt has accused the Office for Budget Responsibility (OBR) of shielding the Labour Party from scrutiny as it prepares to announce tax hikes.

In a letter to OBR chair Richard Hughes, Mr Hunt criticises the organisation for preparing to release a report timed with his successor Rachel Reeves’s first Budget, which addresses a £22bn financial gap attributed to Tory policies. The report is likely to be critical of the last government.

Pension tax relief is a reduction of the amount of tax paid on private pensions. It helps workers save for retirement by boosting their pension pots.

The amount of tax relief a person is granted is based on their income tax. It will effectively cancel out tax on pension contributions up to a maximum of £60,000.

After this, contributions will be taxed at either 20, 40, or 45 per cent, depending on which income tax rate the worker falls into.

However, the chancellor is thought to be considering a flat 30 per cent pension tax relief rate. This would mean that higher earners would effectively pay 10 per cent in tax, while those on the additional rate would pay 15.

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 to receive a 10 per cent boost to their pension contributions.

Evaluating the idea last year, the IFS said it would “redistribute the burden of taxation from the bottom 80 per cent to the top 20 per cent of earners.”

Rachel Reeves will reportedly unveil a major change to Labour’s fiscal rules at the budget on 30 October by borrowing billions for infrastructure investment.

Following weeks of speculation, the chancellor will reveal her plans to change Britain’s debt rules at the International Monetary Fund’s (IMF) annual meeting in Washington on 24 October.

Sir Keir Starmer defended the looming tax rises in Wednesday’s Budget.

He said “better days are ahead” and “everyone can wake up on Thursday and see that a new future is being built, a better future”.

The Prime Minister said: “Borrowing will drive long-term growth. Tax rises will prevent austerity and rebuild public services. We choose to protect working people. We choose to get the NHS back on its feet. We choose to fix the foundations, reject decline and rebuild our country with investment.”

He added: “The time is long overdue for politicians in this country to level with you honestly about the trade-offs this country faces, to stop insulting your intelligence with the chicanery of easy answers.

“Working people know that hard choices are necessary. They lived through the Liz Truss episode. They lived through the cost-of-living crisis.

“So they know that the things they want from us – protecting their living standards, building our nation, fixing our public services – they know that this can only be achieved alongside economic stability.

“There are no short cuts.”