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Just recently, the finance minister, Rachel Reeves, presented a Labour Party budget. People have been calling for Labour’s mission and principles to be more distinctly expressed. Through the choices made – a shift to a fairer tax system, focusing on wealth to pay for tackling child poverty, quality public services and the living expenses – we have unequivocally demonstrated what we believe in.

This is why Labour MPs applauded in the Commons, and it’s why we are ready for the battles to come. And it’s why the cries from the right began right away.

The Main Political Divide in UK Politics

The primary dividing line in British politics is yet again on the economy. On the one side Labour, who aim to reform it so it benefits everyday working people, and on the opposite side, our opponents, who support the current system and the unsuccessful ideology of the past. We must now confront, and prevail in, the debate.

The Tories had 14 years to fix things and in reality, by every standard, they got much worse. Their doctrinaire austerity and trickle-down economics – tax breaks for the wealthy, cutting off investment (causing us with low productivity and wages), and failing to support young people post-Covid – didn’t work.

Record of Failure Under the Previous Administration

Quality of life fell by the largest margin since records began, child poverty reached record levels, NHS waiting lists in England were the highest they’ve ever been, wages remained flat, a housing crisis became entrenched, young people affected by Covid were abandoned. The history of failure goes on.

A single budget alone can’t put all this right, so Labour has a comprehensive plan for rebuilding and for restructuring the country. And we have to go out and continue making the case for why our approach will yield benefits.

Social Security and Child Poverty

Under the Tories, welfare spending significantly increased. As did child poverty, because they didn’t address the root causes: low pay, high housing costs, significant inequalities in education, health and regions. The state ends up paying more to deal with the symptoms instead of the solution.

That’s why we are building more affordable homes than for a generation, increasing wages and enhanced protections for workers, massively boosting investment in infrastructure and new industries, reducing waiting lists down and bringing down the costs of childcare and energy as we pursue 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 eight long years, since it was enacted, poorer families with children have endured from a unjust social experiment that was branded as fair for working people when it was the opposite. Most of the families affected by it have a parent in work.

It has only served to push 300,000 more children into poverty – which, ultimately, costs us more, as well as being callous and unethical.

Tangible Effects in Local Areas

From experience from my own district – where over 5,000 children will be lifted out of poverty as a result of abolishing the cap – the actual impact it’s had. Children wearing £1 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 simple meal or small gift for their kids.

I also see the impact on schools, teachers, social workers, doctors and charities who are already overburdened but have to divert time and resources to supporting children who are living with the results of severe deprivation.

Lasting Effects of Youth Hardship

Just a quarter of pupils from the poorest families achieve five good GCSEs, compared with nearly three in four among wealthier families. This sets them up for the challenges they face throughout their lives: missed potential, economic struggles and ill health. Children who were raised in poverty are more likely to be unemployed or poor as adults.

Confronting child poverty isn’t just a ethical duty, it is a future-oriented strategy. Poverty costs the economy significantly more than the £3bn cost of lifting the two-child cap, or extending 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 extra children pushed into poverty. The benefits of lifting it will not occur overnight either, so acting early in the parliament was crucial.

The cap was a symbol to 14 years of unsuccessful rightwing ideology. Now it is abolished.

Equitable Financing for Measures

We, as Labour, can also be clear that these measures are being paid for in a fair way – from a new gaming tax, closing tax loopholes and a new “mansion tax”.

Conclusion

Equity and purpose – that’s how we will win the battle of ideas. This budget is a clear statement that we won 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 megaphone and define the narrative more forcefully about what’s really wrong with the country and how we are fixing it. We’ve definitely done that this week.

So let’s keep hold of it and win this struggle about how we will rebuild Britain and address the deep inequalities impeding progress.