The news that Sue Gray accepted a big pay rise and is now out-earning the Prime Minister has sparked a civil war among fellow Labour advisors, one of whom has now threatened to ‘pack up and go home’.
News broke yesterday that Ms Gray is on a whopping £170,000, £3,000 more than Sir Keir Starmer.
It’s a big pay rise from her Conservative predecessor Liam Booth-Smith, who took home between £140,000 and £145,000.
While the news sparked fury among the general public, it came as a lightning bolt to fellow Labour Party advisors in Government, many of whom took pay cuts when they entered government, compared to both their previous Labour Party salaries and the salaries of their Tory advisor predecessors.
The special advisor (Spad) contracts already risked a breakdown in relations between No10, but yesterday’s news about Sue Gray lit the tinderbox.
Ms Gray’s pay has sparked outrage among Labour advisors (Image: PA)
One Labour source briefed a journalist: “Sue Gray is the only pensioner to do well under this Labour government.”
Ms Gray was also accused of actively turning down a pay cut, being warned it would cause a major scandal.
A Labour advisor has now told The Times: “The story makes me want to pack up and go home.”
“The rest of us Spads have been in the trenches fighting for four years, then she turned up. She’s fighting with friends she’s not made yet.
“Sue was a senior civil servant. She would know how much the PM makes, so to take a salary of that amount shows an extraordinary lack of political nous.
“Why make enemies of the people who are effectively the glue that allows the leaders in government to work in the best way they can do?”
Sue Gray is Sir Keir’s right-hand woman (Image: Getty)
Fellow Government sources accused Ms Gray of showing “stunning arrogance” and has “only herself to blame”.
Another said: “This story is obviously wildly unhelpful, but it’s not remotely surprising given the level of anger at this situation.”
The Conservatives have now set out 10 questions that Sir Keir must answer about Ms Gray, including whether or not she was involved in setting her own salary.
While the Cabinet Office has said she did not make decisions about her own pay, she did sit on a four-person “special advisors board” that signed off the pay band changes for advisors, including introducing a new £180,000 ceiling.
Ms Gray’s salary was kept secret for weeks, but the new highest pay band raised eyebrows among Spads.
One told the Times: “We began to question, ‘Why did they set that limit there? Who is being paid so much?”
“Sue is seen as the driver behind a clampdown on both overall Spad numbers and pay, so there was a great deal of surprise when it emerged she was setting records for her own pay.”
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HMRC warning as you need to sign this document now to avoid 25% Labour tax raid
Chancellor Rachel Reeves could raise several taxes in the Autumn Statement (Image: Getty)
Taxpayers planning to move around their assets have been urged to act now to sign a key document ahead of expected Labour tax hikes in the Autumn Budget.
Mark Routen, head of Tax at Hoxton Wealth, has issued a warning that Chancellor Rachel Reeves is likely eyeing up hikes to capital gains tax, inheritance tax and on pensions.
Sharing his predictions, Mr Routen said: “It is speculated that the rate of capital gains tax will be aligned to income tax.
“This could mean an increase from 20 per cent to 45 per cent in some cases, or in respect of property 24 per cent to 45 per cent.
“If you are considering selling an asset, to put in simply, you need to take action now and look to do it before the budget.”
He said those looking to sell assets need to take action now to get a key document in place even ahead of the actual sale.
The tax expert explained: “You do not have to complete the sale but get to the binding contract stage and this is the date that triggers the tax.
“You could also look to rebase the cost of any asset by selling and having your spouse purchase back or moving it into an ISA or corporate structure such as a family investment company.
Labour could increase several taxes in the Autumn Statement (Image: Getty)
“This could trigger an immediate charge but offer a potential saving of up to 25 percent long term.”
Turning to inheritance tax, Mr Routen said there could be an end to the reliefs for farmers and unquoted businesses, meaning now is the time to act.
He said: “If you are considering a gift, you should do it now while the gifts are available. There could be changes to the rate and other reliefs as well.”
He also said there could be “big changes” to pensions policy such as to the tax-free lump sum and tax relief on contributions.
The analyst warned: “Pension tax relief is very costly to the government and could come under attack in the budget.
“Labour may reduce the existing annual allowance of £60,000, or introduce a new flat rate of tax relief on pension contributions. Either way, higher or additional rate taxpayers will be the biggest losers.
“The message at this time is if you are considering a contribution make it before the budget and if you are looking to take your tax-fee lump sum also do this before the budget.
“The rate of tax on dividends could well be increased so if you are thinking of making a dividend or have large retained profits now is the time to consider making a payment.
