Could a bank holiday be moved to the Autumn instead?

The Chancellor has set out plans to encourage people to invest their savings.

The government says the changes could give a boost to tens of thousands of people trying to get on the property ladder.

The government says the changes could give a boost to tens of thousands of people trying to get on the property ladder.

On May 22 2024, Rishi Sunak stood outside of Downing Street in the pouring rain and announced he was calling a General Election.

Six weeks later, Sir Keir Starmer pulled up in his car to No 10 on July 5. As he stepped out, the sun came out.

The metaphor was clear. In contrast to the bleak, miserable end to the Tories’ time in charge, here was a new leader promising brighter days ahead.

During his first speech, he told the nation: ‘If you voted for Labour yesterday, we will carry the responsibility of your trust, as we rebuild our country. 

‘But whether you voted Labour or not, in fact – especially if you did not, I say to you, directly, my government will serve you.’ 

Looking back at that day a year on, it might not be too hard to argue that optimistic idea about Starmer bringing a warm glow to the country was quite a pathetic fallacy.

Labour’s polling numbers have collapsed since that day, and the party is now consistently stuck several points behind Reform. The PM himself is doing only marginally better, with a net favourability rating of -34 according to YouGov.

On Tuesday, the government suffered its biggest ever rebellion despite gutting its flagship welfare bill. The following day, the Chancellor wept openly during PMQs.

By Thursday evening, one of Starmer’s MPs, Zarah Sultana, announced she was leaving the Labour party and would ‘co-lead the founding of a new party’ with the ex-Labour leader, Jeremy Corbyn. He said discussions were ‘ongoing’ after the announcement.

Outlining her reasons for leaving the party, Sultana accused the Labour Government of failing to improve people’s lives, and claimed it ‘wants to make disabled people suffer’ in reference to ministers’ proposals to reform welfare – a claim that was rejected by Home Secretary Yvette Cooper.

So where did it all go so wrong?

A fateful speech

It’s impossible to pick a particular moment where the trouble started. But if we were going to have a shot regardless, polls wouldn’t be a bad place to start looking.

They seem to suggest Starmer’s approval rating falls off a bit of a cliff around the end of July 2024 – barely three weeks after he started his new job.

What was happening politically around the end of July? Well, one big thing happened on July 29: that was the day Rachel Reeves stood up in Parliament and declared a massive cut to the winter fuel payment.

In hindsight, it’s a little baffling. Starmer’s government was still defining itself to voters, trying to project an image about who they were and what they represented.

There’s an argument that the Chancellor was aiming to get the tough but necessary decisions out of the way as early as possible, so they would have faded to the back of voters’ minds by the next general election.

But clearly, first impressions matter. Despite the recent backtrack, in which the payment was returned to everyone receiving a pension who has an income below a £35,000 threshold, this might have been the moment many voters made up their mind about the PM and his ministers.

All-consuming black hole

And of course, the Winter Fuel Payment was not the only announcement in this vein. There was inheritance tax on farms, and the retention of the two-child benefit cap.

All these ‘tough decisions’ circled around something else mentioned for the first time in that July 29 speech: the ‘£22 billion black hole’ in the public finances that Reeves said she had found left over by the Conservatives.

Many of Labour’s woes in government can be traced back to this figure. According to the Parliamentary transcript Hansard, the phrase ‘£22 billion black hole’ has been used in the House of Commons no fewer than 287 times since last July, largely in the context of justifying unpopular choices.

Plenty of political goodwill has been spent on filling it but, as might be expected from a black hole, everything else has been sucked into it too.

Several of the government’s policies enjoy broad public support – charging VAT on private school fees to fund state education; closer alignment with the European Union; and expanding free school meals, for example.

But it’s the tricky decisions that the government says it must make to get the country on a firmer fiscal footing that really stick with people.

As a result, a year after the party’s landslide victory, the Labour government has found itself defined more by the things it didn’t want to have to do, than the things it did want to do.

This week, the sun was blazing again ahead of the first Starmiversary. But the Prime Minister may well have spent those days wondering how much longer it’ll be until the clouds clear for him.

Get in touch with our news team by emailing us at webnews@metro.co.uk.

For more stories like this, check our news page.

Readers respond to Rachel Reeves getting teary during PMQ’s, roadblock in welfare reform and the summer of ’76.

Male tears are sincere. Female tears are a story, a scandal.

The Chancellor was making her first appearance in public since PMQs yesterday.

Health Secretary Wes Streeting said the NHS would need to ‘reform or die’.

The images prompted concern from across the political spectrum and from the markets.

‘Vulnerability takes courage.’

Kemi Badenoch said the Chancellor looked ‘absolutely miserable’ at the session this afternoon.

New Look will be closing down dozens of stores in the UK and Ireland by the end of this year.

Anastasia Tempest said she has met Rachel Reeves once over Zoom, and likes her personally (Picture: Anastasia Tempest; Reuters)

‘We believe if you can work, you should work,’ declared Chancellor Rachel Reeves three months ago, …

‘We still have very serious concerns about the plans.’

‘We still have very serious concerns about the plans.’

One of the big lessons from Russia’s invasion of Ukraine in 2022 was how a war hundreds of miles away can have an impact on daily life in the UK.

As the price of a barrel of oil shot up, so did our energy bills, and the cost-of-living crisis that was already hitting households hard was exacerbated.

It now appears that Iran and Israel are on the path towards a full-scale regional war, with neither country paying much attention to international calls for calm heads.

As death tolls rise and destruction spreads, many Brits will be concerned about where it’s all going to end – and wonder if we’re likely to see a repeat of three years ago.

Asked if the government could step in to pay steep energy bills, as the Conservatives did in 2022, Chancellor Rachel Reeves told the BBC: ‘I’m not taking anything off the table.’

However, she cautioned: ‘We’re not anywhere near that stage at the moment – indeed, in July, average energy bills are going to come down by about £100 a year.’

Unsurprisingly, events in the Middle East – one of the world’s top oil producing regions – have an impact on the price of oil.

Following Israel’s attack on Iranian nuclear and military sites on Friday, the cost of a price of a barrel of oil jumped sharply. But there’s a risk the knock-on effects for Brits are much more broad.

Rise in bills

The increase in energy prices largely resulting from Russia’s invasion of Ukraine in 2022 was so significant, the government decided to step in and offer an ‘energy price guarantee’.

If it had not, the price cap for bills could have been pushed north of £4,000 for the typical household.

The invasion pushed oil prices to almost $130 a barrel, meaning costs to suppliers soared, and that was passed down to customers.

After an initial jump of 10% after Israel’s first strikes on Friday, the cost of a barrel of oil has dropped back to $75 – lower than it was in January.

But the big question is whether this conflict will continue for more than a few days or a couple of weeks. That could result in higher prices on a more sustained level, which could feed through to bills.

End in cuts to interest rates

The Bank of England’s base interest rate has a direct impact on households across the country, as it is widely used to set the interest rate on mortgages.

It’s also used by the Bank to try and push down inflation when it gets a bit too high – when the interest rate is increased, people spend less in the economy, which brings down inflation.

Since inflation in the UK has fallen from its extreme high in 2022, the Bank has steadily decreased its interest rate over the past year, easing the pressure on people with a mortgage to pay.

But high energy prices mean items in shops get more expensive, and if they become more expensive than they were a year ago – well, that’s the definition of inflation.

Dr Muhammad Ali Nasir, an Associate Professor in Economics at the University of Leeds, explained the potential impact.

He told Metro: ‘If the increase in energy prices causes another round of sharp increase in inflation, the central bank could change the direction of their policy and start to increase the interest rates again, causing more pain to the household and firms in terms of their borrowing costs.’

New wave to cost-of-living crisis

A sustained increase in energy prices would be enough to increase the cost of a weekly shop in the UK on its own.

But that’s not the only way the conflict between Israel and Iran could have an impact.

There have been concerns Iran could try to block the Strait of Hormuz, a vital supply line for global oil as it links the oil fields of the Persian Gulf to the Arabian Sea and wider ocean.

But Dr Nasir suggested events could lead Iran’s Houthi allies to step up their attacks on ships in the Red Sea, which leads to the Suez Canal.

He said: ‘This could be a massive shock to global trade which is already suffering due to the [US-China] trade war.

On top of that, the economist said there is a ‘sharp increase in the uncertainty around the economic and trade policy due to the conflict’ as the world wonders what will happen next.

‘Overall, this conflict is the last thing the global economy wants at the moment,’ he said, before adding: ‘Of course, loss of human life is an even bigger issue.’

Get in touch with our news team by emailing us at webnews@metro.co.uk.

For more stories like this, check our news page.

One of the big lessons from Russia’s invasion of Ukraine in 2022 was how a war hundreds of miles away can have an impact on daily life in the UK.

As the price of a barrel of oil shot up, so did our energy bills, and the cost-of-living crisis that was already hitting households hard was exacerbated.

It now appears that Iran and Israel are on the path towards a full-scale regional war, with neither country paying much attention to international calls for calm heads.

As death tolls rise and destruction spreads, many Brits will be concerned about where it’s all going to end – and wonder if we’re likely to see a repeat of three years ago.

Asked if the government could step in to pay steep energy bills, as the Conservatives did in 2022, Chancellor Rachel Reeves told the BBC: ‘I’m not taking anything off the table.’

However, she cautioned: ‘We’re not anywhere near that stage at the moment – indeed, in July, average energy bills are going to come down by about £100 a year.’

Unsurprisingly, events in the Middle East – one of the world’s top oil producing regions – have an impact on the price of oil.

Following Israel’s attack on Iranian nuclear and military sites on Friday, the cost of a price of a barrel of oil jumped sharply. But there’s a risk the knock-on effects for Brits are much more broad.

Rise in bills

The increase in energy prices largely resulting from Russia’s invasion of Ukraine in 2022 was so significant, the government decided to step in and offer an ‘energy price guarantee’.

If it had not, the price cap for bills could have been pushed north of £4,000 for the typical household.

The invasion pushed oil prices to almost $130 a barrel, meaning costs to suppliers soared, and that was passed down to customers.

After an initial jump of 10% after Israel’s first strikes on Friday, the cost of a barrel of oil has dropped back to $75 – lower than it was in January.

But the big question is whether this conflict will continue for more than a few days or a couple of weeks. That could result in higher prices on a more sustained level, which could feed through to bills.

End in cuts to interest rates

The Bank of England’s base interest rate has a direct impact on households across the country, as it is widely used to set the interest rate on mortgages.

It’s also used by the Bank to try and push down inflation when it gets a bit too high – when the interest rate is increased, people spend less in the economy, which brings down inflation.

Since inflation in the UK has fallen from its extreme high in 2022, the Bank has steadily decreased its interest rate over the past year, easing the pressure on people with a mortgage to pay.

But high energy prices mean items in shops get more expensive, and if they become more expensive than they were a year ago – well, that’s the definition of inflation.

Dr Muhammad Ali Nasir, an Associate Professor in Economics at the University of Leeds, explained the potential impact.

He told Metro: ‘If the increase in energy prices causes another round of sharp increase in inflation, the central bank could change the direction of their policy and start to increase the interest rates again, causing more pain to the household and firms in terms of their borrowing costs.’

New wave to cost-of-living crisis

A sustained increase in energy prices would be enough to increase the cost of a weekly shop in the UK on its own.

But that’s not the only way the conflict between Israel and Iran could have an impact.

There have been concerns Iran could try to block the Strait of Hormuz, a vital supply line for global oil as it links the oil fields of the Persian Gulf to the Arabian Sea and wider ocean.

But Dr Nasir suggested events could lead Iran’s Houthi allies to step up their attacks on ships in the Red Sea, which leads to the Suez Canal.

He said: ‘This could be a massive shock to global trade which is already suffering due to the [US-China] trade war.

On top of that, the economist said there is a ‘sharp increase in the uncertainty around the economic and trade policy due to the conflict’ as the world wonders what will happen next.

‘Overall, this conflict is the last thing the global economy wants at the moment,’ he said, before adding: ‘Of course, loss of human life is an even bigger issue.’

Get in touch with our news team by emailing us at webnews@metro.co.uk.

For more stories like this, check our news page.

What the Liverpool Central train station could look like if it’s revamped as part of the new rail link plan (Picture: GMCA)

Train journeys between Liverpool and Manchester could soon be half as quick if the rumoured rail link goes ah…

Rachel Reeves will set out the government departments that will get the most generous settlements in the coming years (Picture: James Manning/PA Wire)

The future of the UK’s schools, hospitals and police hangs in the balance this wee…

Rachel Reeves will set out the government departments that will get the most generous settlements in the coming years (Picture: James Manning/PA Wire)

The future of the UK’s schools, hospitals and police hangs in the balance this wee…

The Chancellor’s announcement determines who will get money from the £113 billion pot.

An artist’s impression of how the Sizewell C site could look (Picture: EDF Energy)

A new nuclear power station on the east coast of England will be given a £14.2 billion boost to finally get it off the ground.

Sizewell C in Suffolk …

Rachel Reeves will set out the government departments that will get the most generous settlements in the coming years (Picture: James Manning/PA Wire)

This Wednesday is going to be one of the most important days for Keir Starmer’s go…

The government’s decision sparked protests (Picture: Justin Tallis/AFP)

The vast majority of pensioners will receive the winter fuel payment this year after the government reversed course on its hugely unpopular decision to cut the b…