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Just recently, the finance minister, Rachel Reeves, delivered a Labour budget. The public have been calling for Labour’s purpose and principles to be more distinctly expressed. By way of the choices made – a shift to a more equitable tax system, targeting wealth to pay for tackling child poverty, good public services and the living expenses – we have clearly demonstrated what we believe in.

That’s why Labour MPs cheered in the Commons, and it’s why we are ready for the battles to come. And it’s why the protests from the right began immediately.

The Central Political Divide in UK Government

The primary dividing line in British politics is once again on the economy. On the one hand Labour, who aim to reform it so it helps everyday working people, and on the opposite side, our political opponents, who support the current system and the unsuccessful ideology of the past. We must now take on, and win, the argument.

The Tories had 14 years to fix things and instead, by any measure, they got much worse. Their doctrinaire austerity and trickle-down 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 Decline Under the Former Administration

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

One budget alone can’t fix everything, so Labour has a comprehensive plan for rebuilding and for restructuring the country. And we have to go out and keep making the case for why our approach will yield benefits.

Social Security and Child Poverty

During the Tories, welfare spending rose substantially. As did child poverty, because they failed to tackle the root causes: low pay, high housing costs, deep inequalities in education, health and regions. The state is forced to paying more to manage the effects instead of the cure.

It’s why we are constructing more social housing 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 Limit

This is also the reason we are absolutely right to use this budget to remove the two-child benefit cap.

For almost a decade, since it was enacted, 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, ultimately, costs us more, as well as being heartless and unethical.

Real Impact in Local Areas

I know from my own district – where over 5,000 children will be raised out of poverty as a result of abolishing 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 overcrowded, mouldy homes, parents this Christmas depending 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 overburdened but have to redirect time and resources to supporting children who are living with the consequences of severe deprivation.

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 wealthier families. This sets them up for the disadvantages they face during their lives: missed potential, financial struggles and poor health. Children who were raised in poverty are more likely to be unemployed or poor as adults.

Confronting child poverty isn’t just a moral imperative, it is a long-term investment. 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 urgently 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 effects of lifting it won’t happen overnight either, so acting early in the parliament was vital.

The cap was a symbol 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 just way – from a new gaming tax, closing tax loopholes and a new “mansion tax”.

Final Thoughts

Fairness 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 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 really wrong 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 struggle about how we will rebuild Britain and address the deep inequalities impeding progress.