The Chancellor’s Autumn Statement was billed as a turning point—a moment to reward work, ease the burden on households, and chart a course toward growth. But for millions of workers across the UK, the reality is more sobering. Behind the headlines of tax cuts and wage rises lies a fiscal strategy that continues to squeeze the very people who keep the country running.
The Tax Trap: A Freeze That Burns
The most significant move—cutting the main rate of National Insurance from 12% to 10%—was trumpeted as a tax cut for working people. But this gesture is dwarfed by the ongoing freeze on income tax thresholds, which the government has extended until 2028. This stealth tax, known as “fiscal drag,” means that as wages rise with inflation, more workers are pulled into higher tax bands.
- The Office for Budget Responsibility estimates that the threshold freeze will raise £44.6 billion over six years.
- A worker earning £35,000 will pay around £600 more in tax by 2028 than they would have if thresholds had risen with inflation.
- Over 4 million more people are expected to be dragged into paying income tax or higher-rate tax by the end of the freeze.
Solidarity’s position is clear: this is not a tax cut—it is a redistribution of burden from capital to labour, from wealth to wages. Our members are being asked to fund the state while corporations enjoy record profits and shareholder payouts.
A Welcome Rise in the Minimum Wage—But Not a Living Wage
There is, however, one area where the government deserves cautious praise. From April, the National Living Wage will rise to £12.00 an hour, up from £10.42—a 15% increase. For 21- and 22-year-olds, who were previously excluded from the full rate, this marks a long-overdue correction. The government estimates that 2.7 million workers will benefit.
In practical terms:
- A full-time worker on the new minimum wage will earn £1,800 more per year.
- For a 35-hour week, this equates to a gross annual income of £21,840.
This is a meaningful uplift, especially in sectors like care, hospitality, and retail, where low pay has long been entrenched. But it still falls short of the Real Living Wage, which the Living Wage Foundation calculates at £12.00 across the UK and £13.15 in London—figures based on the actual cost of living.
Solidarity welcomes the increase but urges vigilance. Without robust enforcement, rogue employers will continue to underpay staff. And without parallel investment in housing, transport, and childcare, even £12 an hour will not deliver genuine security.
The Wider Labour Movement Responds
Across the trade union movement, the response to the Budget has been scathing. Sharon Graham, General Secretary of Unite, dismissed the Chancellor’s statement as “a cynical attempt to buy votes with one hand while picking workers’ pockets with the other.” She pointed to the lack of investment in public services and the continued erosion of real wages across the public sector.
Paul Nowak, General Secretary of the TUC, was equally forthright: “This Budget does nothing to fix the cost-of-living crisis. The Chancellor is giving with one hand and taking far more with the other. Working people will still be worse off at the next election than they were at the last.”
Gary Smith of the GMB highlighted the regional disparities: “This Budget does nothing for the care workers in Glasgow, the refuse collectors in Newcastle, or the NHS porters in Cardiff. It’s a Budget for the boardroom, not the break room.”
These critiques reflect a shared frustration: that the government continues to prioritise headline-grabbing tax tweaks over the structural investment needed to rebuild public services, tackle inequality, and deliver a fairer economy.
Scotland’s Workers: Caught in the Crossfire
For workers in Scotland, the Budget’s contradictions are especially stark. While the minimum wage rise will offer some relief, the tax freeze will hit hard. Scotland’s devolved income tax system already imposes higher rates on middle earners, and the UK-wide threshold freeze compounds this burden.
- A Scottish worker earning £30,000 will pay around £1,500 more in income tax and National Insurance than someone on the same salary in England.
- Public sector workers in Scotland, already facing pay restraint, will see little benefit from the Chancellor’s headline measures.
Solidarity calls for a coordinated response from Holyrood and Westminster to ensure that wage gains are not clawed back through stealth taxation. We also urge the Scottish Government to match the minimum wage uplift across all public sector contracts and to accelerate the rollout of collective bargaining in social care.
A Budget for Whom?
The Autumn Statement reveals a government more concerned with optics than outcomes. The Chancellor’s tax cut may dominate the headlines, but the underlying reality is one of continued austerity by stealth. Public services remain underfunded, local authorities face bankruptcy, and the social safety net is threadbare.
Meanwhile, the wealthiest continue to benefit from capital gains tax breaks, non-dom status, and corporate loopholes. The burden of funding the state has shifted decisively onto the shoulders of working people.
Solidarity stands with our fellow unions in demanding a new economic settlement—one that prioritises public investment, fair taxation, and decent work. We will continue to fight for a future where wages rise with dignity, not just inflation, and where the fruits of growth are shared by all, not hoarded by the few.
By Maria Camara