Rachel Reeves rules out 'widows tax' after backlash over winter fuel cuts

Rachel Reeves has ruled out imposing a "widows tax" following the furious backlash over winter fuel cuts.

After a bruising first 81 days in government, the Chancellor will tell Labour's conference in Liverpool there will be no return to austerity in her budget next month.

The Express understands that Ms Reeves will keep the 25% single person council tax discount.

Tories had warned that ending the reduction in bills would amount to a "widows tax" because it would affect many older women living alone after losing their husbands.

Ms Reeves has also dismissed calls from the left for a new wealth tax to claw in cash, but cuts to the winter fuel allowance will still go ahead.

The Chancellor will insist on Monday that she will deliver a budget of "real ambition".

"There will be no return to austerity. Conservative austerity was a destructive choice for our public services - and for investment and growth too," she will say.

"We must deal with the Tory legacy and that means tough decisions. But we won't let that dim our ambition for Britain.

"So it will be a budget with real ambition. A budget to fix the foundations. A budget to deliver the change we promised. A budget to rebuild Britain.

"My budget will keep our manifesto commitments. Every choice we make will be within a framework of economic and fiscal stability.

"We said we would not increase taxes on working people, which is why we will not increase National Insurance, the basic, higher or additional rate of income tax, or VAT.

"And we will cap corporation tax at its current level for the duration of this Parliament."

After complaints within the Cabinet about the relentlessly downbeat messages from the Prime Minister and his Chancellor about the state of the country.

Ms Reeves will insist her "ambition for Britain knows no limits" and insist she can deliver growth.

She will say: "I can see the prize on offer, if we make the right choices now. And stability is the crucial foundation on which all our ambitions will be built.

"The essential precondition for business to invest with confidence and families to plan for the future. The mini-budget showed us that any plan for growth without stability only leads to ruin.

"So, we will make the choices necessary to secure our public finances and fix the foundations for lasting growth.

"Stability, paired with reform, will forge the conditions for business to invest and consumers to spend with confidence. Growth is the challenge. And investment is the solution."

The Chancellor will say that growth is the Labour Government's number one mission to "create jobs that pay enough to raise a family on, for you and your children. Put real money in the pockets of working people and wealth in all our communities, that flows into vibrant high streets."

"This is how we'll achieve what we promised - a decade of national renewal," she will say.

Ms Reeves's attempts to strike a more optimistic tone come after warnings that she has been talking the UK into a downturn.

Consumer confidence plummeted in September by seven points in a long-running survey by GfK.

The fall was blamed on cuts to winter fuel payments and warnings of a difficult budget ahead.

It came on the back of a drop in business confidence recorded by the Institute of Directors and the Confederation of British Industry.

Business leaders warned the gloomy warnings coming from Ms Reeves and Sir Keir Starmer were stopping people from spending and companies from investing.

Shadow Chancellor Jeremy Hunt said the government was put the economy at risk to score political points against the Conservatives.

He said: "The Chancellor has already damaged the UK's international reputation by talking down her inheritance in order to score political points.

"If she believes in growth, where is the plan? People are beginning to suspect there may not be one.

"If all we get in the budget is tax rises and employment laws that deter investment and job-creation she will have thrown away a golden opportunity."