Keir Starmer fuels national insurance tax hike fears as Tory leadership row breaks out – latest news

Labour is beginning to outline its vision for business reforms, although full implementation might take up to two years.

Here’s what the government is proposing:

• Statutory sick pay: Workers will receive sick pay from the first day of illness, abolishing the current three-day waiting period and eliminating the lower earnings threshold.

• Parental leave: Labour plans to introduce day-one rights to both paid and unpaid paternity leave, removing the requirement for fathers to have worked for 26 or 53 weeks to qualify. A new statutory right to bereavement leave will also be established.

• Flexible working rights: Employees will have the right to request flexible working arrangements. Employers will be required to justify refusals based on eight specific criteria.

• Zero-hour contracts: The reforms include a ban on exploitative zero-hours contracts, ensuring that workers are offered contracts based on actual hours worked over 12-week reference period. This would also require advance notice of shift patterns and compensation for last-minute cancellations.

However, the plans do not include Labour’s long promised introduction of a single worker category aimed at curbing exploitation in the gig economy as well as the much discussed “right to switch off”.

Robert Jenrick is set to deliver a speech at the Policy Exchange think tank today in a bid to build momentum after securing his place in the final two of the Tory leadership race.

The former immigration minister heads to the final stage alongside Kemi Badenoch after James Cleverly was shockingly knocked out.

Mr Jenrick will speak at noon in central London.

Sir Keir Starmer has welcomed Ukraine’s Volodymyr Zelensky to Downing Street as the pair discuss the UK’s support for Kyiv.

The prime minister said it was a chance for the Ukrainian leader to talk through his plans in more detail.

Sir Keir said it was “very important we’re able to show our continued commitment to support Ukraine” and it was a chance to “go through the plan, to talk in more detail”.

The government has confirmed it will not impose mandatory flexible working on companies.

Business secretary Jonathan Reynolds insisted Labour will instead introduce statutory guidance regarding when businesses can deny such requests.

In an interview with the BBC, the minister explained that while the new measures will clarify acceptable grounds for refusing flexibility, employers will not be forced to comply.

He said: “There will be some clear statutory guidance with grounds upon which that wouldn’t be possible.

“So that might mean you have to train junior members of staff, it might be that you have management responsibilities.

“But it will be straightforward and of course we should always recognise where this can be agreed between an employer and employee.”

The exit of the frontrunner is the most astonishing result in a Tory leadership ballot since Michael Portillo lost to Iain Duncan Smith, writes John Rentoul.

And there may be one final twist in the tale…

As chancellor Rachel Reeves prepares for the Autumn Budget on 30 October, Sir Keir Starmer has ignited concerns by not ruling out an increase in National Insurance contributions.

During a heated exchange at Prime Minister’s Questions yesterday, Sir Keir faced questions from Tory leader Rishi Sunak, who pressed him on the future of the government’s tax policy.

But the PM refused to rule out a possible hike in the future, claiming: “I’m not going to get drawn on conclusions.”

Previously, National Insurance rates had seen significant reductions. In January, the rate for 27 million workers dropped from 12 per cent to 10 per cent and it fell further to 8 per cent in April as part of Jeremy Hunt’s tax reforms.

It comes as the Institute for Fiscal Studies (IFS) estimates Rachel Reeves may need to raise up to £25 billion from tax increases if she wants to keep public spending rising with national income.