MONEY TALK
Martin Lewis gives his verdict on what the new Labour government means for your money
The money saving expert warned of a financial black hole
MARTIN Lewis has offered his verdict on what a new Labour government means for your money.
Keir Starmer will be the country's new Prime Minister after the political party won over 400 seats in the General Election, beating the Conservatives.
1
Labour has made big promises before polling day on what they would deliver including protecting pensions and cutting energy bills.
The founder of MoneySavingExpert appeared on Good Morning Britain this morning to give his opinion on how Labour’s win will impact people's finances.
Martin congratulated the party on its success but warned listeners the new government would face a “big economic black hole.”
"I suspect Labour once they fully get into government are going to have some type of revelation and say wow the finances are so much worse than what we expected...there is a big economic black hole and do some expectation management,"; he said.
READ MORE ON MONEY
Events such as the Covid-19 pandemic and Russia’s invasion of Ukraine have placed a huge strain on the UK economy in recent years.
Families have also been under huge financial pressure due to the rising costs of goods and household bills.
Martin told viewers that Labour will be “looking for things that do not cost the exchequer a lot of money to do”.
He said: "They are going to want to show people things have changed and they mean action... but they are going to have to do it in a way that, where unless it was previously announced in a manifesto, it doesn't cost [any money]."
Most read in Money
Labour wooed voters with a swathe of promises to help put extra cash in their pockets and improve major issues such as the housing crisis.
The new government ruled out increasing the rate of major taxes but confirmed that the freeze in income tax thresholds will remain until 2028.
The party also said it will build 1.5million homes with the aim of getting more people on the property ladder.
"Let see if they can deliver that one," Martin said.
However, the expert said the prospect of building more homes should be "certainly helpful" for mortgage holders.
Labour also planned to introduce a "Freedom to Buy" scheme to help people secure a mortgage.
The mortgage guarantee scheme may help 5% of first time buyers a year.
Martin said there was a "lot more" the party could be doing on the issue, but it was outside of the manifesto and unlikely to get immediately actioned.
Labour also confirmed it would ban no-fault evictions to make it harder for landlords to remove tenants without a good reason
"[No fault evictions] needs to change and I think it will change," Martin said.
LABOUR'S PROMISE
HOW A LABOUR government will impact your personal fiances
FOR PENSIONS?
The Labour party has promised to keep the pensions triple lock in place, which comes as a relief to pensioners worried about the cost of living.
But the party will not recreate the conservatives’ promise to increase the personal allowance for pensioners in line with the state pension.
ON TAX
Labour has ruled out increasing the rate of major taxes but has confirmed that the freeze in income tax thresholds will remain until 2028.
This means more of your income will end up in the taxman’s pocket as earnings increase over time.
CHILDCARE
Labour has pledged to revamp the UK's childcare system, which will come as welcome news to working families who are struggling.
This includes opening 3,000 new nursery classes across England to open up access to childcare hours for families.
BENEFITS
As part of their promise, Labour said it will launch a review into Universal Credit.
The party also aims to tackle poverty and lower the amount of people using emergency food parcels.
A big part of the party's manifesto is also encouraging more people into work, and making changes so fewer workers need state support.
NEW HOMES
Labour plans to build 1.5million homes which is good news for those struggling to get on the housing ladder.
It also promised new buyers first dibs on properties in new developments before they are sold overseas.
The party also plans to ban no-fault evictions, which will provide much-needed security for renters.
The money expert has extensively spoke on issues such as the energy crisis, and ways for people to save on their bill.
The energy price cap is currently at £1,568 - the lowest level in two years, and will remain this way until September.
However, Martin warned today that in the next review the figure could rise to between seven to 13%.
He reiterated on the show the promise Labour made to him about lowering the standing charge customers currently pay if the party was elected, which could come as relief for struggling customers.
"For those struggling to make ends meet, we’ll stop the scandal of expensive pre-payment meters being forced on vulnerable people, " Starmer told ,
"And we’ll work with the energy regulator to reduce the standing charges that hit poorer households, he added.
Until the end of September 2024, the average standing charge cap is approximately 60p per day for electricity and 31p per day for gas for those on standard variable tariffs paying via a direct debit.
The standing charge is a fixed daily amount that households pay, regardless of how much energy they use.
Critics like Martin say that the charge is unfair. But others have warned that ditching it could place a higher burden on those with higher energy usage like the elderly and disabled.
Ofgem, the energy regulator, is currently reviewing how the price cap is calculated, including standing charges.
READ MORE SUN STORIES
Talks of potential energy bill rises comes as some households have just days to submit a meter reading to ensure they are getting the best deal.
Customers who don't send their suppliers regular readings will have their bills calculated by estimated usage, and they will likely pay more - so it is always worth carrying out a check.
WHEN IS THE DEADLINE TO SUBMIT A READING
THE deadline you have to submit a reading varies from supplier to supplier.
Some companies will allow you to backdate the reading if you miss the exact date it was meant to be submitted.
But that may not always be the case so it is worth speaking to the customer service team at your energy supplier to double check.
The UK's biggest energy suppliers have shared with Sun readers what date they can backdate up to.
British Gas: : If customers took a reading on 1st July, but don’t get a chance to provide it on the day, a form on the BG meter read page will be available until July 14 which will allow them to submit the read they took on 1st July.
The company's meter read page is available for all customers to provide meter reads and customers can take and submit meter readings anytime, including on 1st July. You’ll see the options our customers have on that page.
EDF: EDF customers will be able to back date their meter reads at any time up to and including Tuesday, July 9.
Customers will be able to leave meter reads via the EDF App, or online via their MyAccount.
Readings can also be submitted via telephone, email or by text and WhatsApp.
Topics