"TRULY TERRIBLE!" – Rachel Reeves DESTROYED Live in Commons | Labour's U-Turn EXPOSED

Added: 2026-06-01

[00:00:00]growth is up. It is actually down. She claimed borrowing is down. It's 75% up compared to the plans that she inherited.

[00:00:12]She claimed she's fighting inflation. We have the highest inflation in the G7.

[00:00:18]She claimed she's cutting energy bills.

[00:00:21]Energy bills have gone up under this Labour government. Mention unemployment.

[00:00:27]Rachel Reeves stood up in the Commons this week to announce something the government has spent months insisting it would never do. She cancelled the fuel duty rise, the one she'd defended repeatedly through the autumn and into the new year. The one she said was necessary, fiscally responsible, non-negotiable, and there she was cancelling it. It was always obvious that the fuel duty increase would need to be cancelled. Obvious to everyone except the Chancellor. The Shadow Chancellor, Mel Stride, put it simply enough. The Conservative Party had been arguing against this rise for months.

[00:01:00]Reeves had batted them away every single time, and now quietly she's come round to their position while somehow framing it as her own good judgment. Promises made by a Labour government, promises delivered by a Labour government, and I commend this statement TO THE HOUSE.

[00:01:19]THANK YOU. THANK YOU, MADAM DEPUTY SPEAKER, and could I thank the Chancellor for advance sight of her statement. Of course, the press got even more advance sight of it. Madam Deputy Speaker, the decision taken to cancel the increase in fuel duty is welcome. It has been a long time coming. The Conservative Party has been campaigning against the fuel duty rise for months, but the Chancellor's defended that policy repeatedly.

[00:01:49]That left motorists and businesses worried about even higher fuel prices in in That's the part that sticks, not the U-turn itself. Governments change course. That's not unusual, and it's not always wrong. What grates is the explanation. We're told the economy has improved, that the forecast justify the decision. But the IMF's updated growth figure for Britain this year is 1%. In April, they were forecasting 1.3. So, the picture hasn't brightened, it's dimmed slightly, and we're being told the opposite.

[00:02:19]It was always obvious that the fuel duty increase would need to be cancelled, obvious to everyone except the Chancellor. So, can I ask, why did the Chancellor fight us on fuel duty for so long? Why has she been so hell-bent on raising fuel duty during an enemy an energy crisis? Well, inevitably, Madam Deputy Speaker, the U-turn has finally come.

[00:02:47]But, Madam Deputy Speaker, it is astonishing to hear the Chancellor claiming that the government can afford to help households because the forecasts have improved.

[00:02:59]Is the Chancellor seriously suggesting that the economic outlook is now better than at the time of the last fiscal forecast, when we have had the Iran conflict, to which our economy is highly exposed thanks to this government's ruinous choices?

[00:03:18]The Chancellor has just pointed to the IMF forecast being upgraded this week.

[00:03:25]But let's be very clear about what is going on here.

[00:03:29]The IMF adjusted their growth forecast for this year up slightly to 1%.

[00:03:35]But until April, they were forecasting 1.3%.

[00:03:40]So, where exactly is the supposed growth dividend? Will she directly address that point?

[00:03:47]This is exactly the same game that the government played last year when they U-turned on cuts to the winter fuel payment. They claimed then they were U-turning because the economy was improving when of course it was due to political pressure. Nobody bought it then and nobody is buying it now.

[00:04:09]Once again, we have a weak government caving into the inevitable after spending months defending a truly terrible decision.

[00:04:18]Madam Deputy Speaker, the Chancellor claims the measures announced today will be funded by a number of different tax measures. But most of the measures she mentions are already in place and baked into the OBR's forecasts. So given the Chancellor has not announced any measures to control government spending, can she confirm that in fact the measures she is announcing today will be funded at least in part by yet more government borrowing?

[00:04:47]>> [snorts] >> And can she confirm whether fuel duty rates will still be rising to the same level as previously planned after December or whether today's announcement will mean a permanent reduction in fuel duty?

[00:05:00]Madam Deputy Speaker, whilst we on this side of the house welcome some of the measures the Chancellor has taken today like the increase in mileage allowances, this is all very minor compared to the inflation this government have fueled since coming into office. And the tax rises that the Chancellor has imposed.

[00:05:21]Today's announcements will bring little comfort to the hundreds of thousands of people who have lost their jobs, to the countless businesses that have folded, and to those high streets which are now hollowed out.

[00:05:34]The reality is that we are in a terrible position to deal with the consequences of this latest energy crisis thanks to the actions that this government has taken.

[00:05:46]The Chancellor claimed growth is up. It is actually down. She claimed borrowing is down. It's 75% up compared to the plans that she inherited.

[00:05:59]She claimed she's fighting inflation. We have the highest inflation in the G7.

[00:06:06]She claimed she's cutting energy bills.

[00:06:09]Energy bills have gone up under this Labour government.

[00:06:13]And of course, she didn't mention unemployment. Energy, Madam Deputy Speaker, on energy. This government have made a conscious decision not to exploit our own natural resources in the North Sea.

[00:06:26]Weakening our economy and our energy security.

[00:06:30]Whilst importing oil from Putin's Russia at the cost of Ukrainian lives.

[00:06:36]Families and businesses are facing Families and businesses are facing rising costs and rising taxes.

[00:06:45]People are losing their jobs. The country is hurting. If the Chancellor was serious about the challenges we face, she would commit to getting spending down, tackling the benefits bill, getting taxes down to strengthen our economy.

[00:07:00]But thanks to the Chancellor's mistakes and the weakness of this dying government, this statement today is all we get. Does the Chancellor really think this is enough?

[00:07:17]Thank you very much, Madam Deputy Speaker. Let me take the issues that the Shadow Chancellor has raised. First of all, in on fuel duty. When I became Chancellor of the Exchequer, the freeze in fuel duty was due to expire under the plan set out in the final budget of the Conservatives within a matter of months.

[00:07:38]I've frozen fuel duty twice already, and I've frozen it again today. And indeed, I've frozen it with more than 3 months to go before the increase was due to happen, giving people plenty of time. I have always said since the Middle East conflict began that I would keep an eye on what was happening to oil and gas prices and set out plans ahead of the change due to come to effect in September, and that is exactly what I've done. But I've also gone further in three specific areas with additional support for hauliers, additional support for red diesel, particularly helping the rail freight industry and farmers, and also the higher mileage rates. And the Shadow Chancellor says he welcomes the changes on mileage mileage rates. But it's the first time they've been increased since 2011. So if he welcomes them so much, why didn't they increase them when they had 14 years in government?

[00:08:33]On the Iran conflict, well, let's remember that this is a war that the UK did not start, that this government chose not to join, whereas the Conservatives and Reform were cheering on that conflict every step of the way.

[00:08:47]And the impacts on the UK economy and the global economy would be much more severe if we'd have heeded the warnings of heeded the pleas of Reform and Conservatives to join that conflict.

[00:09:01]The Shadow Chancellor talks about inflation and growth. Well, inflation yesterday, the numbers showed that inflation had fallen. We're the only country in the G7 where inflation fell last month. The OBR Oh, sorry, the IMF have revised up our growth forecast, and we had the fastest growth of the G7 in the first quarter of this year. And the Shadow Chancellor says, "Is this going to be paid for with new borrowing?" No, it's not. If you Shadow Chancellor had been listening, he would have heard the changes we're making around the foreign branch exemption. That will raise hundreds of millions of pounds a year, which is why we are able to afford the package that we have announced uh today. The Shadow Chancellor mentions uh high streets.

[00:09:45]Well, because of the pride in place uh money that I announced at the budget, because of the banking hubs, and indeed because of the changes we made to business rates, uh which have actually seen business rates uh for retail and hospitality come down and come down significantly compared to the plans we inherited from the Conservative government, we can reinvigorate our high streets. The Shadow Chancellor mentions borrowing. Well, borrowing has fallen below 5% for the first time since 2019 because of the actions that I have taken as Chancellor, and borrowing is expected to fall in every year of this Parliament, very different from what happened under the Conservatives.

[00:10:21]Employment and activity uh remain in the top half of the OECD and of the G7. And the biggest benefits boom became under the last Conservative government when the Shadow Chancellor was the Work and Pensions Secretary.

[00:10:37]And on oil and gas, oil and gas will play an important role in our economy for many years to come, but we also need to invest in renewable energy, which is why we announced yesterday uh restrictions in the number of judicial reviews that are holding up investment in clean energy. It is a shame that the Conservatives uh um voted against our Planning and Infrastructure Act. It's a shame that the Liberal Democrats abstained on it, but we are determined to get Britain building, including the energy infrastructure we need to get uh bills down. And just um a couple of weeks ago, I announced changes around tiebacks to make it easier for oil and gas companies to exploit their reserves of oil and gas in the new North Sea. And Jackdaw and Rosebank would have gone ahead if it hadn't been for the last government messing up the way it uh um legislated. Uh and we are going to be announcing uh uh shortly uh uh the decisions the the of State for Energy and Net Zero will make those decisions, but I am very clear oil and gas will play an important role in the UK for many years to come adding to our energy security alongside investment in nuclear, in small modular reactors, in floating offshore wind, in onshore wind and solar opposed by the party opposite.

[00:11:49]>> If you follow this channel, it might be worth bookmarking this one. The full exchange in the Commons tells a rather different story than the headlines will.

[00:11:57]Stride also raised borrowing up 75% against the plans Labour inherited, he said. Reeves disputed the framing. She pointed to borrowing falling below 5% for the first time since 2019. Both things can be technically true and tell completely different stories, which is rather the problem with how these things get reported. What she didn't address was unemployment. Stride raised it. She moved on. Whether that omission means anything, you're better placed to judge than most commentators will give you credit for. What we've seen this week is a government that held a position, took the political hits for holding it, and then abandoned it not because circumstances changed dramatically, but because the pressure became too much.

[00:12:34]That's a particular kind of weakness, not dramatic, not scandalous, just quietly telling.