Sir Keir Starmer 'absolutely' confident in chancellor after rows with farmers, pensioners, and employers

Sir Keir Starmer has said he is "absolutely" still confident in Chancellor Rachel Reeves after her financial plans sparked rows with pensioners, farmers and employers.

The prime minister said his government needed to "stabilise the economy" when it came into power and has already "attracted investment that wasn't coming in" during the Tories' 14 years in Downing Street.

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Sir Keir was speaking from the G20 summit in Brazil, which came as thousands of farmers descended onto Whitehall to protest changes to inheritance tax (IHT) announced in the budget.

In further trouble at home, a letter from the retail sector warned of job losses because of the planned rise to employer national insurance, while government modelling has suggested 100,000 extra pensioners could be in poverty by 2027 because of the winter fuel payment cut.

Asked if he still had confidence in his financial plans, and Ms Reeves, Sir Keir said: "Absolutely.

"We had to stabilise the economy, deal with the £22bn black hole, and we needed to invest in the future of our country.

"The reason we got into such a mess was because the last government refused to take a single difficult decision."

Sir Keir said that was made clear by the position of new Tory leader Kemi Badenoch, who he claimed "wants investment into the health service, housing... but doesn't want to raise any money to pay for it".

"We have ended that, we have turned a page...the best evidence of that is the investment that is now coming into this country in the way it wasn't in the last 14 years."

Nuclear war rhetoric 'irresponsible'

G20 leaders gathered at the meeting on what is the 1,000th day since the start of the Ukraine war.

During the Q&A, Sir Keir hit out at Vladimir Putin after the Russian leader lowered the threshold for a nuclear strike.

"This is irresponsible rhetoric coming from Russia and that is not going to deter our support for Ukraine," he said.

The prime minister would not be drawn into saying whether he would follow the advice of a senior Labour figure, Lord Mandelson, and take steps to end a feud with US businessman Elon Musk - a key figure in Donald Trump's incoming government.

Farmer facts 'speak for themselves'

However, he could not escape questions on domestic affairs as he deals with a triple whammy of problems at home.

This includes a row that erupted with farmers over the introduction of a 20% inheritance tax on farms worth more than £1m from April 2026.

Ministers insist it will only affect around 500 of the UK's 209,000 farms, but the National Farmers' Union (NFU) say the real number is two-thirds of farms and the measure could threaten the UK's food supply if family farms have to shut.

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Farmers' tax protest portrays mounting concern for sector

Sir Keir said the "facts speak for themselves" when asked if TV presenter Jeremy Clarkson was spreading misinformation by claiming 96% of farmers will be affected by inheritance tax changes.

The former host of Top Gear, who previously said one of the main reasons he decided to buy a farm in the Cotswolds was to avoid IHT, joined today's protest against the government's decision.

"I'm not going to get into the business of commenting on what Jeremy Clarkson says," the prime minister said.

"For a typical family wanting to pass on [a farm] through the family, with all the allowances in place, it's a £3m threshold.

"The vast majority of farms are unaffected by this."

The farmers' protest came as the retail lobby warned in a letter to the chancellor that her decision to raise employer national insurance and the national minimum wage would be passed on to shoppers and hit employment and investment.

Defending that decision, Sir Keir argued protections were put in place "so half of employers will either see no change to their NICs, or they'll be paying less", while there will be no tax rises on working people's pay slips.

And on the winter fuel cut analysis, he said the uptake in pension credit was "not included" in the impact assessment and that is "an additional benefit".

(c) Sky News 2024: Sir Keir Starmer 'absolutely' confident in chancellor after rows with farmers, pensioners