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Just recently, the chancellor, Rachel Reeves, delivered a Labour Party economic plan. The public have been calling for Labour’s purpose and principles to be more distinctly articulated. Through the choices made – a shift to a more equitable tax system, focusing on wealth to pay for addressing child poverty, good public services and the cost of living – we have unequivocally demonstrated what we stand for.

This is why Labour MPs applauded in the Commons, and it’s why we are up for the fights to come. And it’s why the protests from the conservative side began right away.

The Central Dividing Line in British Politics

The central division in British politics is once again on the economy. On the one hand Labour, who want to change it so it helps ordinary working people, and on the other, our opponents, who favor the current system and the unsuccessful doctrine of the past. We must now confront, and win, the argument.

The Tories were given 14 years to resolve things and in reality, by every standard, they got far more dire. Their ideological austerity and supply-side economics – tax cuts for the wealthy, reducing investment (causing us with low productivity and wages), and neglecting to support young people post-Covid – proved ineffective.

Record of Failure Under the Former Government

Living standards dropped by the largest margin since records began, child poverty hit record levels, NHS waiting lists in England were the highest on record, wages remained flat, a housing crisis became entrenched, young people affected by Covid were abandoned. The history of failure continues.

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

Welfare Spending and Youth Deprivation

Under 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 ends up paying more to manage the effects instead of the cure.

That’s why we are building more social housing than for a generation, raising wages and enhanced protections for workers, massively boosting investment in infrastructure and new industries, reducing waiting lists down and lowering the costs of childcare and energy as we drive for clean power.

Ending the Two-Child Limit

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 cruel social experiment that was branded 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, in the end, costs us more, as well as being heartless and immoral.

Tangible Effects in Communities

I know from my own constituency – where over 5,000 children will be lifted out of poverty as a result of ending the cap – the real impact it’s had. Children wearing £1 wellies as school shoes, children going to bed without food and cold, living in cramped, 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 divert time and resources to supporting children who are living with the consequences of deep poverty.

Lasting Consequences of Child Poverty

Just one in four pupils from the poorest families achieve five good GCSEs, compared with almost 75% among wealthier families. This sets them up for the challenges they face during their lives: unrealized 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 far, far more than the £3bn cost of removing the two-child cap, or expanding free school meals.

That’s why 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 won’t happen overnight either, so acting early in the parliament was vital.

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

Fair Funding for Policies

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

Final Thoughts

Equity and direction – that’s how we will win the contest of ideas. This budget is a clear statement that we gained the election as Labour, and will lead as Labour. As I consistently said during my campaign to become deputy leader, we must reclaim the political platform and define the narrative more strongly about what’s truly flawed with the country and how we are fixing it. We’ve definitely 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 impeding progress.