here the chancellor of the exchequer, rachel reeves, has told the bbc that she hopes labour's first budget in m years — which includes tax rises of £40 billion — will "wipe the slate clean" and put public finances on a "firm trajectory." the chancellor said she would restore economic stability and invest more in schools, the nhs and housing. the scale of the budget was huge with employers and businesses carrying a lot of the tax burden. the opposition leader rishi sunak described the budget as "an enormous borrowing spree" that contains "broken promise after broken promise". our business correspondent emma simpson has this report. finally, the details. as the headlines came thick and fast, labour's first budget was big in every way.

this is not a sort of budget that we would want to repeat, but this is the budget that is needed to wipe the slate clean and to put our public finances on a firm trajectory. today, we are fixing the foundations and ensuring that businesses and families can look ahead and plan for the future with confidence. but her budget began with £40 billion of tax rises — more than half of it from a 1.2 pence increase in employer national contributions from april, raising an extra 25 billion. the threshold on which firms start to make payments will be lowered, too. capital gains tax is also going up — that's the profit you make from selling assets like shares. the freeze on inheritance tax thresholds will continue until 2030, and inherited pensions will also be taxed. other measures include a new tax on vaping, but better news on the cost of a pint, with a 1.7% reduction in duty

for draught beer. fuel duty will remain unchanged for at least another year, and carers will be able to earn more before losing their allowance. this is the biggest tax—raising budget for a generation to pay for more spending on public services — much of it a big cash injection for the nhs — and businesses are bearing the brunt of it. the government has also changed the rules on debt so it can borrow more — tens of billions of pounds for investment on things like roads, schools, rail, clean energy projects. the aim is to boost growth. they have taken the easy path, which is to pick the pockets of businesses. what their own watchdog, the office for budget responsibility, says is that means lower living standards for ordinary family, lower

wages, higher prices. however they mask it as not affecting working people, when labour raise taxes, working people pay the prize. == raise taxes, working people pay the rize. , . raise taxes, working people pay the prize.- there - raise taxes, working people pay the prize.- there are i the prize. -- price. there are a coume _ the prize. -- price. there are a coume of — the prize. -- price. there are a couple of gambles, - the prize. -- price. there are a couple of gambles, the - a couple of gambles, the spending increases are front loaded — spending increases are front loaded for this year and next yeah — loaded for this year and next yeah will_ loaded for this year and next year. will that be sustainable? secondly, quite big increases in borrowing. will the government be able to actually sell those, sell that debt without paying higher interest rates? — the government is banking that short—term pain will be worth it in the longer term. the question now is how this budget lands with households and businesses in the coming days. emma simpson, bbc news. rachel reeves defended her tax raising budget and plans for economic growth. the

raising budget and plans for economic growth. the office for bud . et economic growth. the office for budget responsibility, - economic growth. the office for budget responsibility, who - economic growth. the office for budget responsibility, who are| budget responsibility, who are the independent forecaster, are saying that growth, increase in the next couple of years and then back to a more trend level. but the summit of my ambition for growing our economy is greater than that. we have been in government for less than four months, we are already putting forward plans and making changes to our planning system to get britain building again, to our pension system to unlock long—term patient capital to help small businesses grow. reforming our skills system and getting more young people on apprenticeships and helping older people that want to retrain. there is more we want to do. but we made a start yesterday, particularly with the capital investment in infrastructure, in transport projects, in energy infrastructure, in digital and broadband and the 0br say that will boost our growth over the longer term, so we are maischinging the decisions int

—— so we are making the decisions in long—term interest of our country and putting us on a better path than we were previously. shadow chancellorjeremy hunt says he welcomes more investment in the nhs but he argues the budget�*s tax increase is going to hurt economic growth. i worry if you want more money for the nhs for example, in the long run there is only one way to pay for that and that is to have a successful economy. what the 0br said yesterday is as a result of these changes, the economy is going to to be weaker. we will have lower living standards, higher prices, fewerjobs, more expensive mortgages, life will get tougherfor ordinary people, get tougher for ordinary people, because when you raise taxes, however much you mask as

a tax or employers, it gets passed on to employees with lower wages. passed on to employees with lowerwages. so passed on to employees with lower wages. so sing it was a mistake. it is the easy ching thing for any chancellor to raise taxes, but the long—term damage to growth and competitiveness is profound. if she had wanted to do this, you know before the election, she should have said so. we could have had this debate. what is making people angry today is that she said 30 times before the election that she wouldn't increase taxes beyond what was speued increase taxes beyond what was spelled out in the labour manifesto. and many people believed her and many people thought it was a new labour prospectus, not a traditional tax and spend prospectus and they have woken up to a chancellor who has givens the biggest tax—raising budget in history.

which need a different budge budget to give people the fair they deserve. we women push them _ they deserve. we women push them to— they deserve. we women push them to do more for our nhs and care _ them to do more for our nhs and care |_ them to do more for our nhs and care. . , them to do more for our nhs and care. .,, them to do more for our nhs and care. .,, ., care. i was looking for the chancellor _ care. i was looking for the chancellor to _ care. i was looking for the chancellor to introduce i chancellor to introduce policies _ chancellor to introduce policies and _ chancellor to introduce policies and a - chancellor to introduce policies and a change i chancellor to introduce | policies and a change to chancellor to introduce - policies and a change to the taxation_ policies and a change to the taxation system _ policies and a change to the taxation system that - policies and a change to the taxation system that would | taxation system that would create _ taxation system that would create a _ taxation system that would create a fairer— taxation system that would create a fairer society - taxation system that would create a fairer society and i taxation system that would | create a fairer society and a greener— create a fairer society and a greener society. _ create a fairer society and a greener society.— create a fairer society and a greener society. she inherited a challenging _ greener society. she inherited a challenging situation, - greener society. she inherited a challenging situation, but i a challenging situation, but despite the fact it is a significant budget in terms of tax rises, if we consider the increase to provision of public services it is still modest. if services it is still modest. if you're a small business, you will— you're a small business, you will he — you're a small business, you will be saying, what have i done — will be saying, what have i done wrong, why do i deserve this tax— done wrong, why do i deserve this tax burden? it done wrong, why do i deserve this tax burden?— done wrong, why do i deserve this tax burden? it was a risky budaet, this tax burden? it was a risky budget. taxes _ this tax burden? it was a risky budget, taxes are _ this tax burden? it was a risky budget, taxes are up, - this tax burden? it was a risky i budget, taxes are up, spending is up. _ budget, taxes are up, spending is up. the — budget, taxes are up, spending is up, the books _ budget, taxes are up, spending is up, the books have _ budget, taxes are up, spending is up, the books have been- is up, the books have been cooked _ is up, the books have been cooked and _ is up, the books have been cooked and we _ is up, the books have been cooked and we are - is up, the books have been cooked and we are looking | is up, the books have been. cooked and we are looking at fantasy — cooked and we are looking at fantasy forecasts. _ cooked and we are looking at fantasy forecasts. and - cooked and we are looking at fantasy forecasts. and i'm i fantasy forecasts. and i'm

worried _ fantasy forecasts. and i'm worried-— fantasy forecasts. and i'm worried. our chief political correspondent _ worried. our chief political correspondent has - worried. our chief political correspondent has the - worried. our chief political - correspondent has the political reaction to this first labour budget in ia years. it reaction to this first labour budget in 14 years.- reaction to this first labour budget in 14 years. it was a hue budget in 14 years. it was a huge moment, _ budget in 14 years. it was a huge moment, the - budget in 14 years. it was a huge moment, the first - budget in 14 years. it was a . huge moment, the first labour budget in ia years, but made especially so by the significance of the choices that rachel reeves has made. she has been acknowledging this morning that the massive increase in business taxation, thatis increase in business taxation, that is how a lot of £a0 billion will be raised, will feed through to employees and acknowledged that some workers may see their wages go up more slowly as a result of decisions she unveiled yesterday. but she has been defending the honesty of her decisions. she has been denying criticism it is a massive departure what what she said during the election campaign. and the way that he she argues that is she says,

look, when we were in opposition, we didn't have access to the full government books, now we have seen both the black hole, the argument that she repeatedly has made since july, that she repeatedly has made sincejuly, but that she repeatedly has made since july, but also that she repeatedly has made sincejuly, but also that public services need more. that is the rachel reeves defence of her budget. is the rachel reeves defence of her budget-— her budget. that has been the accusation _ her budget. that has been the accusation from _ her budget. that has been the accusation from the _ her budget. that has been the accusation from the shadow i accusation from the shadow cabinet, from rishi sunak, the former prime minister and also the shadow chancellor this morning, saying that what labour said when it was running to be made government they have now reneged on those promises. yes it is funny, we get a new conservative leader on saturday, but until then rishi sunak and jeremy hunt, the former prime minister and the former prime minister and the former chancellor, in fact they're both former chancellors, theirfinal moment chancellors, their final moment in chancellors, theirfinal moment in front line politics is responding to this budget. you saw a fiery denunciation of the budget from rishi sunak and

jeremy hunt the shadow chancellor making similar arguments today. i think we knew in advance of the budget there would be questions after about rachel reeves�* honesty. but we thought that would focus on this question that has been doing the rounds about whether it was consistent with the labour manifesto in the general election for a labour government to increase the employers�* rate of national insurance. now we have a broader question about honesty and whether raising taxes by this amount to fund public services is consistent with the spirit, notjust of labour�*s general election manifesto, but more generally with the way keir starmer and rachel reeves presented themselves to the public over the last three or four years. public over the last three or four years— four years. explain the headline _ four years. explain the headline that - four years. explain the headline that rachel i four years. explain the - headline that rachel reeves has been saying that this not something that she would want to do again?— to do again? one of the really interesting — to do again? one of the really interesting details _ to do again? one of the really interesting details in - to do again? one of the really interesting details in the - interesting details in the budget is that there is a

significant increase particularly in health and education spending in the first couple of years of the five years where spending and fax has been allocate —— tax has been allocated. but then it starts to taper off. beyond those two areas, spending growth isn�*t as big as you would imagine, and there have been various economic experts questioning whether it is truly plausible that spending would taper off after a couple of years in the way that the treasury documents state that they will. rachel reeves�* answer to that is yes it will, because this initial burst of spending will be funded by that increase in taxes but after that public service reform will come into the picture. she hopes the new labour government will find a way to reform public services such they don�*t require such a big burst of spending to improve, in order for people to feel like public

services are at the level they would want them to be. it is a cliche, but time will tell. but plenty of previous governments have hoped for reform but found actually they need a lot of money in the end. let�*s take another look at some of the key points from the first labour budget in nearly 15 years, which contained tax rises worth £ a0 billion rises worth £ a0 billion to fund the nhs and other public services. £25 billion will come from a rise in employers�* national insurance contributions. the inheritance tax threshold freeze will be extended by a further two years to 2030 — but unspent pension pots will be subject to the tax from 2027. and the chancellor is abolishing the �*non—dom�* tax status, which allows some uk residents to pay most of their tax in a different country if they nominate it as their permanent home.

as for where the extra money will be spent — more than £22 billion will go to the nhs in england for day—to—day spending. money for the construction and maintenance of school buildings will increase to £6.7 billion in england next year, with an extra £1 billion earmarked for special educational needs. and almost i2—billion pounds has been allocated to compensate victims of the infected blood scandal, with a further one—point—eight billion set aside for wrongly prosecuted post office sub—postmasters. wales, scotland and northern ireland have also seen increases in their budgets, in line with the changes made in england. andy verity explains how businesses are reacting. they have been — businesses are reacting. they have been unhappy—

businesses are reacting. they have been unhappy and - businesses are reacting. tie: have been unhappy and saying this will affect employment, hit their profits, mean they can hire less people and may not be able to pay as much in pay rises. the ig est biggest effect is what they have done with the threshold. you only pay national insurance on any money you pay above £750 a month. they�*re cutting that almost in half to £5,000 a year. so for every employees, those employers will have to pay for that, for the cutting of the threshold another £615 per employee. that is a big hike in the cost of employing people. you also have the hike in employers�* national insurance. that is not direct taxes on working people, but what the office for budget responsibility says is that that will probably mean that wages won�*t rise by as much as

they otherwise would have done. but we have been used for years now with pay not keeping up with inflation. in the last year with inflation. in the l