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Just recently, the finance minister, Rachel Reeves, delivered a Labour Party budget. The public have been calling for Labour’s mission and values to be more distinctly articulated. Through the decisions made – a transition to a more equitable tax system, targeting wealth to fund tackling child poverty, quality public services and the living expenses – we have clearly set out what we stand for.

This is why Labour MPs cheered in the Commons, and it’s why we are ready for the battles to come. And it’s why the cries from the conservative side began immediately.

The Central Political Divide in UK Government

The central dividing line in British politics is once again on the economy. On the one side Labour, who want to change it so it benefits ordinary working people, and on the opposite side, our political opponents, who support the current system and the failed ideology of the past. We must now confront, and win, the debate.

The Tories were given 14 years to resolve things and instead, by every standard, they got much worse. Their doctrinaire austerity and supply-side economics – tax breaks for the wealthy, cutting off investment (leaving us with poor productivity and wages), and neglecting to support young people after the pandemic – didn’t work.

Record of Failure Under the Previous Administration

Quality of life 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 took hold, young people affected by Covid were left on the scrapheap. The record of failure goes on.

One budget alone can’t put all this right, so Labour has a comprehensive plan for renewal and for rewiring the country. And we have to go out and continue making the argument for why our strategy will reap dividends.

Social Security and Child Poverty

During the Tories, welfare spending rose substantially. As did child poverty, because they didn’t address the underlying issues: low pay, high housing costs, significant inequalities in education, health and regions. The state is forced to paying more to manage the symptoms instead of the cure.

That’s why we are constructing more affordable homes than for a generation, increasing wages and new rights for workers, greatly increasing investment in infrastructure and new industries, reducing waiting lists down and lowering the costs of childcare and energy as we pursue clean power.

Ending 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 introduced, 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’s done nothing but push 300,000 more children into poverty – which, ultimately, costs us more, as well as being callous and immoral.

Tangible Effects in Local Areas

From experience from my own constituency – where over 5,000 children will be raised 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 hungry and cold, living in overcrowded, mouldy homes, parents this Christmas 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 stretched but have to redirect time and resources to supporting children who are living with the consequences of deep poverty.

Lasting Consequences of Child Poverty

Just a quarter of pupils from the most disadvantaged families achieve five good GCSEs, compared with nearly three in four among affluent families. This predisposes them for the disadvantages they face during their lives: missed potential, economic 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 three billion pound cost of removing the two-child cap, or expanding free school meals.

That’s why we acted promptly in the budget, despite the challenging economic context. Every day with this cap in place sees over a hundred additional children pushed into poverty. The benefits of lifting it will not occur overnight either, so taking early action in the parliament was vital.

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

Equitable Funding for Measures

We, as Labour, can also be explicit that these measures are being funded 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 succeed in the battle of ideas. This budget is a clear statement that we gained the election as Labour, and will lead as Labour. As I repeatedly said during my campaign to become deputy leader, we must reclaim the political megaphone and define the narrative more strongly about what’s truly flawed with the country and how we are repairing 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 tackle the deep inequalities holding us back.