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Yesterday, the chancellor, Rachel Reeves, delivered a Labour budget. The public have been asking for Labour’s purpose and values to be more clearly expressed. Through the decisions made – a shift to a more equitable tax system, focusing on wealth to fund tackling child poverty, good public services and the living expenses – we have unequivocally demonstrated what we believe in.

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

The Central Political Divide in UK Politics

The central dividing line in British politics is yet again on the economy. On the one side Labour, who want to change it so it helps everyday working people, and on the opposite side, our opponents, who favor the current system and the failed ideology of the past. We must now take on, and prevail in, the argument.

The Tories had 14 years to resolve things and instead, by every standard, they got far more dire. Their doctrinaire austerity and trickle-down economics – tax cuts for the wealthy, cutting off investment (leaving us with low productivity and wages), and failing to support young people post-Covid – didn’t work.

Record of Decline Under the Former Government

Living standards dropped by the biggest amount since records began, child poverty reached record levels, NHS waiting lists in England were the highest they’ve ever been, wages were stagnant, a housing crisis became entrenched, young people affected by Covid were left on the scrapheap. The history of failure continues.

One budget alone can’t fix everything, so Labour has a long-term plan for rebuilding and for rewiring the country. And we have to go out and continue making the case for why our approach will reap dividends.

Social Security and Child Poverty

Under the Tories, welfare spending rose substantially. As did child poverty, because they failed to tackle the underlying issues: 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 constructing more social housing 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 pursue clean power.

Removing the Two-Child Benefit Cap

It’s also why 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 suffered from a cruel social experiment that was marketed as fair for working people when it was anything but. 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 heartless and unethical.

Real Impact 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 low-cost wellies as school shoes, children going to bed hungry and cold, living in overcrowded, mouldy 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 Consequences of Youth Hardship

Just one in four pupils from the most disadvantaged families achieve five good GCSEs, compared with almost 75% among affluent families. This sets them up for the challenges they face during their lives: missed potential, financial struggles and poor health. Children who were raised in poverty are more likely to be jobless 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 three billion pound cost of lifting the two-child cap, or extending free school meals.

This is the reason we acted promptly 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 effects of lifting it won’t happen overnight either, so acting early in the parliament was crucial.

The cap was a totem to 14 years of failed conservative ideology. Now it is gone.

Equitable Financing for Policies

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

Final Thoughts

Fairness and purpose – that’s how we will succeed in the contest of ideas. This budget is a clear statement that we won the election as Labour, and will lead as Labour. As I consistently said during my campaign to become deputy leader, we must seize back the political platform and set the agenda 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 keep hold of it and prevail in this fight about how we will rebuild Britain and address the entrenched inequalities holding us back.