Nigel Farage is facing criticism for potentially sparking a trade dispute with the European Union by proposing to terminate benefits for EU citizens in the UK. The leader of Reform UK is set to announce during a press briefing that he intends to cease Universal Credit payments for EU nationals, claiming it could save up to £6 billion. This move would contradict the Brexit agreement negotiated by the Conservative Party, which grants certain benefits to EU citizens with settled status.
Labour has warned that Farage’s proposal could escalate into a trade war between the UK and Brussels, resulting in higher prices for British consumers. Farage defended his plans, emphasizing cost savings and prioritizing British citizens over foreigners to avoid the need for tax increases.
Reform UK stated that EU citizens receiving Universal Credit would be given a three-month notice period before their payments cease, as part of a transitional phase. The party asserted that Farage would seek to renegotiate the benefits aspect of the Brexit deal, a move likely to be rebuffed by European capitals.
In response, a Labour spokesperson criticized Farage’s financial projections, arguing that his policies would burden British taxpayers and lead to increased prices for consumers due to the risk of a trade conflict with Europe. Labour pledged a budget that would establish a stable economic foundation without austerity measures or borrowing beyond means.
Reform UK outlined a £25 billion plan that aims to eliminate the necessity for Chancellor Rachel Reeves to raise taxes in the upcoming Budget. The party proposed raising the immigration health surcharge to £2,718 annually from £1,035, anticipating a £5 billion increase in revenue.
As the Chancellor prepares to unveil the Budget on November 26 and address a significant fiscal shortfall, options to adhere to strict spending rules are being considered. Recent forecasts from the Office for Budget Responsibility suggest a deficit of around £20 billion, a more positive outlook than previously anticipated.
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