Sir Keir Starmer has attempted to define who “working people” are, amid renewed scrutiny of his tax plans ahead of next week’s Budget.

Labour promised at the general election not to increase taxes on working people – but it is looking to raise some taxes to fund public services.

This could include increases in tax on the sale of assets, such as shares and property, a freeze on income tax thresholds and changes to inheritance tax.

Sir Keir has repeatedly been asked whether “working people” would be hit by these changes.

He insists they won’t but has struggled to offer a clear definition of what counts as a working person in the government’s eyes.

In an interview during a Commonwealth leaders’ summit, the prime minister was asked whether those who work, but get additional income from assets such as shares or property, would count as working people.

He replied that they “wouldn’t come within my definition” – but warned against making “assumptions” about what that meant for tax policy.

He said he thought of a working person as someone who “goes out and earns their living, usually paid in a sort of monthly cheque” and who can’t “write a cheque to get out of difficulties”.

Speaking afterwards, his spokesman sought to clarify that those with a “small amount of savings” could still be defined as working people.

This could include cash savings, or stocks and shares in a tax-free Individual Savings Accounts (ISA), he suggested.

But ministers have been reluctant to translate these comments into numbers.

The prime minister accepted that his own definition was “broad”.

Those people he had in mind, he added, were those who were “doing alright” but had an “anxiety in the bottom of their stomach” about making ends meet if something unexpected happened to their family.

The issue has taken on a central political importance ahead of next Wednesday’s Budget, Labour’s first since 2010, amid a row over whether the party is sticking to promises it made in its election manifesto.

During a BBC interview back in the UK, Treasury minister James Murray was asked repeatedly to give a more precise answer.

When asked whether someone who owned shares or sold a business could be a working person, he said he would not “get into too many hypotheticals”.

As well as the broad pledge not to raise taxes for working people, Labour’s manifesto specifically ruled out raising rates of income tax, along with National Insurance and Value Added Tax (VAT).

But ministers have not ruled out continuing to freeze income tax thresholds beyond 2028, a policy they inherited from the Conservatives, dragging more people into higher bands over time as wages rise with inflation.

And they have also not ruled out making employers pay National Insurance on their contributions to workers’ pension pots, which the Conservatives have branded a “tax on work” that will indirectly hit workers.

Labour peer Lord Blunkett, a cabinet minister in the Blair government, said the “logical outcome” of the move was that “employers will pay less”.

He also cautioned that he was unsure of the government’s definition of a working person, adding: “We’ve got to find a different phraseology”.

Other rumoured tax rises include to capital gains tax, which is paid on profits made by selling assets including shares and property other than a main home.

The government is also planning to increase the amount of money it raises in inheritance tax, which is paid after around 4% of deaths.

Multiple changes to the tax, which currently includes several exemptions and reliefs, are under consideration.

London mayor Sadiq Khan has halved – compared to last year – the minimum amount of money he is asking from the government to fund major transport projects.

The Labour mayor had asked the last Tory government in 2023 for a minimum of £569m to pay for a range of infrastructure upgrades, and complained after receiving only £250m.

Khan told the Local Democracy Reporting Service he now believes it would count as “a win” to receive “anything more than £250m” from the Labour government.

City Hall Tories said the mayor was “watering down” what they claim were “exaggerated financial demands”.

Khan said the reduced funding demand was due to the “£22bn black hole” in public finances cited by the chancellor.

Ahead of the last government’s autumn statement in November last year, Khan had said in a letter to then-Chancellor Jeremy Hunt that Transport for London (TfL) “needs £569m in capital support for 2024/25 to support critical network upgrades and investment in critical road assets”.

He added: “Failure to secure this funding would put vital upgrades at risk and be detrimental to long-term infrastructure investment in the capital’s transport network, with consequential negative impacts on the wider UK economy.”

However, asked earlier this week what he will be requesting from the new government, Khan said: “I’ll be asking for north of £250m. The £250m we got last year was before the £22bn black hole in the government’s year-to-year expenditure.”

The chancellor’s claim that she had inherited a £22bn gap in the public finances was met with ridicule by her Conservative opponents.

Her predecessor, Hunt, said she would “fool absolutely no one” and accused her of a “shameless attempt” to lay the groundwork for tax rises in her upcoming Budget.

But Khan insisted Reeves had been forced to find ways to “make ends meet”, and said, in that context: “I’ll ask for as much as I can get. But what I’m saying is, a win is getting anything more than £250m.”

He said the “real prize” will be at the spring spending review where he hoped to secure a multi-year deal for funding after the 2025/26 financial year.

Neil Garratt, leader of City Hall Conservatives said: “Last year the mayor said that £500m was the absolute minimum to stop TfL collapsing, but this year he claims that anything ‘north of £250m’ is a win.”

“Consistently under Khan’s mayoralty he made exaggerated financial demands, which made it impossible for a Conservative government to work constructively with him.

“Now that he has a Labour government he can’t get away with that; he’s forced to be honest. What other demands are going to be watered down in the next few years?”

Next Saturday we will finally find out who the Conservatives have chosen as their next party leader – and the leader of the UK government’s official opposition.

The two contenders, Kemi Badenoch and Robert Jenrick, are both seen as being on the right of the party, and their core messages, on immigration and cultural issues, seem designed to win back support from Nigel Farage’s Reform UK.

But the new leader will also need to do something about the votes the Tories lost to the Liberal Democrats and Labour in July’s general election, if they are going to restore their party’s battered fortunes.

Few parts of the country illustrate the challenge the new leader will face better than Cornwall.

The county used to be a sea of Conservative blue. Until recently, the party held all six Parliamentary seats.

But the tide turned in July’s election, and they were all washed away.

The Tories lost four seats to Labour and two to the Lib Dems, while Reform UK took votes across the board.

In the market town of Liskeard, which sits in a constituency the Tories lost to Labour, Richard Dorling chairs the South East Cornwall Conservative Association and spent time during the election knocking on doors and hearing voters’ concerns.

“They’re looking for people to take charge and reduce immigration and stop the boats, and Reform have a very strong story for that,” he said.

“Whoever gets into the leadership position is going to have to come up with a new plan to tackle that, and get the voters back.”

While some Tories argue addressing the concerns of voters attracted to Nigel Farage’s party is crucial, others have warned against tacking to the right to counter the threat posed by Reform UK, for fear it will permanently alienate more centrist former Conservative supporters who turned to Labour or the Lib Dems.

When Kemi Badenoch and Robert Jenrick became the final two candidates, it was widely seen as a signal the party would shift to the political right.

Connor Donnithorne, who stood for the Conservatives in Camborne & Redruth but lost to Labour, said focusing on the party’s position on the political spectrum was the wrong approach.

“You need to be in the common ground of British politics if you want to win,” he said. “That doesn’t mean you have to be in the centre, or the left or right.

“If we go down that path over the next five years, we’re not going to win again because you’re too focused on the internal politics of parties that the overwhelming majority of people in this country don’t actually care about.”

He argues that the party needs to focus on “common ground” issues such as “controlled immigration, lower taxes for working people, and supporting small businesses to create jobs”.

“It’s about having credibility, it’s about being in touch with what people want and it’s about delivering what say you say you’re going to deliver,” he adds.

It’s not just their fractured voting base the new Conservative leader will have to win round.

Kemi Badenoch or Robert Jenrick will have to unite a parliamentary party that’s been publicly arguing over its differences for years – and has been pretty adept at ousting leaders.

In reaching the final two, neither candidate won support from a majority of MPs, so whoever wins will do so knowing only around a third of the parliamentary party backed them.

Nick Craker, a Conservative councillor in Cornwall, said the leadership candidates need to focus on policies that unite the Conservatives rather than those that have the potential to divide them, including Robert Jenrick’s plan to leave the European Convention on Human Rights (ECHR) and “culture wars” confronted by Kemi Badenoch.

“The idea of leaving the ECHR, for example, makes me very nervous,” said Mr Craker.

“I just see that as a really divisive issue that’s going to cause infighting. I just think if you bring something like that forward, there’s going to be at least 50 MPs who are going to be very concerned about it.

“Similarly with some of Kemi’s ideas around gender and race and the culture wars, that makes me a bit nervous, because again she may have some really sound arguments to make on that, but there another 50 MPs at least that have probably got very different views to her and that’s going to just sow a bit more division and infighting.

“And what have we learnt from the last election? Divided parties don’t win.”

Badenoch and Jenrick are currently pitching to the party membership who are casting their ballots in this contest, but it will not be long before one of them will have to start pitching to the country.

In Cornwall, one message reflected by activists is the need for the party leadership to talk to grassroots members of the party who, they say, understand the issues in their communities.

Alison Hernandez, the Conservative Police and Crime Commissioner for Devon and Cornwall, said: “I think they’ve lost their way with being able to connect with members and activists in the party, and I think that needs to change – that connection.”

Of course, whoever leads the Conservative Party after 2 November will do so as a party of opposition – something neither Robert Jenrick or Kemi Badenoch have experienced as MPs.

That makes fighting for relevance harder when airtime and attention doesn’t come as easily.

Ms Hernandez added: “It feels like we’re invisible at the moment on the national stage, and it’s really important we’ve got someone who can embody the values of Conservatism and communicate that to the wider public.”

The Conservative Party is wrestling right now with what those values are, but the bigger question will ultimately be what the public makes of them.

The UK “can’t change our history”, Prime Minister Sir Keir Starmer has told the BBC when asked about paying reparations to countries impacted by the transatlantic slave trade.

His comments come after diplomatic sources told the BBC that Commonwealth heads of government want to start a “meaningful conversation” about an issue that could mean the UK paying billions of pounds for its historical role in the trade.

Sir Keir, who is currently in Samoa for a meeting of Commonwealth countries, said the trade was “abhorrent” and that it was important to “talk about our history”.

Chancellor Rachel Reeves ruled out making payments, in an interview earlier on Thursday, saying “that’s not something that this government is doing”.

However, he added that the focus should be on “today’s challenges” including resilience in the face of climate change and boosting trade between Commonwealth nations.

He added he wanted to help member countries work with international financial institutions to “unlock money that might help them” in relation to climate change.

Leaders from 56 countries are attending the Commonwealth Heads of Government Meeting taking place in Samoa on Friday and Saturday.

Commonwealth leaders are expected to defy the UK and debate ways of securing reparations for historical slavery. At its height, Britain was the world’s biggest slave-trading nation. Downing Street has the issue is not on the agenda for the summit.

Reparatory justice for slavery can come in many forms, including financial reparations, debt relief, an official apology, educational programmes, building museums, economic support, and public health assistance.

In the run-up to the summit, there have been growing calls from Commonwealth leaders for the UK to apologise and make reparations.

King Charles will formally open the summit and is expected to use his opening speech to pay tribute to his mother the late Queen Elizabeth II and her connection to the Commonwealth.

He will also say the Commonwealth’s scale and diversity allows it to “discuss the most challenging issues with openness and respect”.

During the gathering, a new Commonwealth secretary general will be elected. All three of the candidates – Shirley Botchwey of Ghana, Joshua Setipa of Lesotho and Mamadou Tangara of Gambia – back reparatory justice.

Speaking to BBC Radio 4’s Today programme, Frederick Mitchell, the foreign minister of the Bahamas, said he believed the UK would change its stance, saying: “It may take a while for people to come around but come around they will.”

During the interview with the BBC, Sir Keir was also asked about a complaint Donald Trump’s team has filed against the Labour Party objecting to its staff and activists volunteering for Kamala Harris’s presidential campaign.

“I think this needs to be seen for what it is,” the prime minister said, adding: “It is some Labour Party members and staff in their free time campaigning.

“It’s happened in every election in different parts of the world. All political parties do it… I think it needs to be put in it’s proper perspective.”

Sir Keir added that both he and Trump wanted to have a “good working relationship” and that the pair recently had dinner together.

He dismissed suggestions that his party were still adjusting to being in government, saying he had “absolute clarity” on his “number one mission” of economic growth.

Next Wednesday Chancellor Rachel Reeves, will set out the government’s tax and spending plans in the Budget.

Ahead of this Reeves told the BBC she would be changing the government’s self-imposed debt rules to free up money for infrastructure spending.

Asked about the Budget, Sir Keir said the economy barely grew under the Conservatives and that he wanted to “clear the decks” and “clear up the mess”.

“I believe in running towards problems. If you know what the problem is, what the challenge is, every business knows this, every family knows it, run towards it and fix it.”

The Conservatives have challenged Labour’s argument that they created a £22bn black hole in the economy and questioned the chancellor’s decision to change the debt rules.

The party’s shadow Treasury minister Gareth Davies said “uncertainty over additional borrowing risks interest rates staying higher and for longer.

“It’s families up and down the country who would pay the price.”