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Just recently, the finance minister, Rachel Reeves, delivered a Labour Party economic plan. The public have been calling for Labour’s mission and values to be more clearly expressed. Through the decisions made – a transition to a fairer tax system, focusing on wealth to fund tackling child poverty, quality public services and the cost of living – we have clearly demonstrated what we stand for.

That’s why Labour MPs applauded in the Commons, and it’s why we are up for the battles to come. And it’s why the cries from the right began immediately.

The Main Political Divide in British Politics

The primary division in British politics is once again on the economy. On the one side Labour, who aim to change it so it benefits ordinary working people, and on the opposite side, our political opponents, who support the current system and the unsuccessful ideology of the past. We must now confront, and win, the argument.

The Tories had 14 years to fix things and in reality, by every standard, they got much worse. Their ideological austerity and supply-side economics – tax breaks for the wealthy, reducing investment (causing us with poor productivity and wages), and failing to support young people after the pandemic – didn’t work.

Record of Failure Under the Former Administration

Living standards fell by the biggest amount since records began, child poverty hit record levels, NHS waiting lists in England were the highest on record, wages remained flat, a housing crisis took hold, young people scarred by Covid were left on the scrapheap. The history of failure goes on.

One budget alone can’t put all this right, so Labour has a long-term plan for renewal and for restructuring the country. And we have to go out and continue making the case for why our strategy will yield benefits.

Social Security and Child Poverty

Under the Tories, welfare spending significantly increased. As did child poverty, because they failed to tackle the root causes: low pay, high housing costs, deep inequalities in education, health and regions. The state is forced to paying more to deal with the symptoms instead of the solution.

It’s why we are building more affordable homes than for a generation, raising wages and enhanced protections for workers, greatly increasing investment in infrastructure and new industries, getting waiting lists down and lowering the costs of childcare and energy as we drive for clean power.

Removing the Two-Child Benefit Cap

This is also the reason we are completely justified to use this budget to lift the two-child benefit cap.

For almost a decade, since it was enacted, poorer families with children have suffered from a unjust social experiment that was marketed as fair for working people when it was the opposite. Most of the families impacted by it have a parent in work.

It has only served to push 300,000 more children into poverty – which, in the end, costs us more, as well as being callous and immoral.

Real Impact in Communities

From experience from my own constituency – where over 5,000 children will be raised out of poverty as a result of ending the cap – the actual impact it’s had. Children wearing low-cost wellies as school shoes, children going to bed without food and cold, living in cramped, damp homes, parents during the holidays relying on food banks for a modest meal or small gift for their kids.

I also see the impact on schools, teachers, social workers, doctors and charities who are already stretched but have to redirect time and resources to supporting children who are living with the results of deep poverty.

Lasting Effects of Youth Hardship

Just one in four pupils from the most disadvantaged families achieve five good GCSEs, compared with nearly three in four among affluent families. This sets them up for the disadvantages they face throughout their lives: missed potential, financial struggles and ill health. Children who grew up in poverty are more likely to be unemployed or poor as adults.

Addressing child poverty isn’t just a moral imperative, it is a future-oriented strategy. Poverty costs the economy far, far more than the £3bn cost of lifting the two-child cap, or expanding free school meals.

This is the reason we acted urgently in the budget, despite the challenging economic context. Every day with this cap in place sees more than 100 additional children pushed into poverty. The benefits of lifting it will not occur overnight either, so acting early in the parliament was vital.

The cap was a symbol to 14 years of failed rightwing ideology. Now it is gone.

Fair Funding for Policies

We, as Labour, can also be clear that these initiatives are being paid for in a just way – from a new gambling levy, eliminating tax loopholes and a new “mansion tax”.

Final Thoughts

Equity and direction – that’s how we will succeed in the battle of ideas. This budget is a clear statement that we gained the election as Labour, and will govern as Labour. As I consistently said during my campaign to become deputy leader, we must reclaim the political platform and define the narrative more forcefully about what’s truly flawed with the country and how we are fixing it. We’ve certainly done that this week.

So let’s maintain it and prevail in this fight about how we will renew Britain and tackle the deep inequalities holding us back.