Afternoon summary
Keir Starmer has said it would be a “big mistake” to think that Ukraine no longer needs military help because a peace deal is inevitable. (See 1.09pm.)
Rachel Reeves, the chancellor, has said the Ukraine crisis will not result in the government breaking its manifesto pledge not to raise income tax, VAT or employee national insurance. In an interview with Beth Rigby for Sky’s Electoral Dysfunction podcast, Reeves said:
So we increased taxes at the budget to plug the gaps in the public finances and to make sure we had money for the National Health Service. But we’ve just gone through a massive cost of living crisis for many people. They’re still struggling with that cost of living crisis. So I don’t think it is the right thing to do to increase income tax, national insurance or VAT on working people.
And we made that commitment in our manifesto less than a year ago that we weren’t going to increase those taxes on working people. We’re not going to renege on that commitment.
But the former Tory chancellor George Osborne said Reeves should use the current crisis to “go big”. Speaking on his own podcast, Political Currency, he said the government’s current fiscal situation was “unsustainable” because of the need for higher spending, but the constraints imposed by Labour’s tax pledges and its fiscal rules. He went on:
You should go big in a situation like this, you’ve got the perfect excuse - it’s not just an excuse - it’s actually an explanation, which is, it’s a very unsettling global situation. So you go big, you don’t try and swallow this statement in a couple of weeks into a kind of parliamentary reply to an OBR forecast, and try and pretend it’s not a budget. You say ‘The world’s changed. [We’re in] dramatically more dangerous times. Everyone can see that, and we’ve got to respond.’
Updated
More than 100 MPs back call for defence to count as ethical investment in light of need to support Ukraine
More than 100 Labour MPs and peers have called on British financial institutions to class UK defence investments as ethical to boost support for Ukraine, PA Media reports. PA says:
In an open letter, the group called for a “rethink” on environmental, social and governance (ESG) investment requirements that often exclude defence firms as “unethical”.
Labour MP Alex Baker co-ordinated the letter addressed to Britain’s banks and fund managers, with signatories including former Royal Navy chief admiral Lord West, former Nato secretary general Lord Robertson and chairman of the Commons defence committee Tan Dhesi.
The group said financial institutions can “do more” to help the UK defence sector support Ukraine’s war effort as well as “rapidly generate the capabilities it needs to defend itself”.
The letter from Labour MPs read: “For the United Kingdom to both support Ukraine in its hour of need and ensure defence of our own nation, we must rethink ESG mechanisms that often wrongly exclude all defence investments as ‘unethical’. There can be no more ethical investment than giving the Ukrainian people every ounce of support that can be mustered by their allies.”
Asked whether No 10 agrees that missiles and fighter jets should count as ethical investments, a Downing Street spokesperson said: “The only ethical issue, the main ethical issue at stake here is that Russia has launched this barbaric invasion of Ukraine and they could end this war today by withdrawing their troops. Our commitment to Ukraine remains unwavering.”
The previous Conservative government also called for defence investment to be classed as ESG.
