Labour faced criticism last night for abandoning an incoming social care cost cap, even though only a few weeks before to the announcement it would not do so.

Chancellor Rachel Reeves made the decision to plug what she claimed was a multibillion-pound "black hole" in the public budget created by the Tories, one of several projects she had scrapped.

A £86,000 lifetime cap on the amount spent on social care would have been imposed under changes scheduled to take effect in October of next year. Currently, permanent, short-term, and nursing home care must be fully paid for by anyone with savings of more than £23,250. These costs can easily reach six figures.

But Ms Reeves confirmed the cap would be ditched, saving £1.1 billion by April 2026.

Only last month Health Secretary Wes Streeting promised the cap would be introduced if Labour won the election.

'We are very unhappy with the UK Government's decision not to proceed with the cap on social care costs in England,' stated Emily Hindle, policy manager at the Alzheimer's Society, last night.

For those suffering from dementia, providing appropriate social care is essential. In England, they account for about 60% of those receiving care at home and 70% of those receiving residential care for the elderly.

'While we appreciate the financial challenge the new Government faces, this decision pushes the burden on to individuals who pay around £100,000 for care on average when they are already dealing with dementia's devastation on their lives.'

Ms Reeves yesterday released a document entitled 'Fixing the Foundations' in which she claimed that the Tories had left a £22 billion 'black hole' in the public finances for this year (2024/25). To help plug it she outlined £5.5 billion of savings for this year (2024/25), which included axing a series of spending and infrastructure projects. The savings next year (2025/26) will amount to £8.1 billion.

Tax rises and further spending cuts are expected to be announced in the Autumn Budget on October 30.

In another move that will affect nearly ten million elderly people, Ms Reeves said winter fuel payments for pensioners will become means tested. Currently, 11.4 million individuals receive the benefit. But this will drop to 1.5 million under Labour's plans.

Ms Reeves told the Commons: 'The Government will continue to provide winter fuel payments worth £200 to households receiving pension credit or £300 to households in receipt of pension credit with someone over the age of 80. Let me be clear, this is not a decision I wanted to make, nor is it the one I expected to make – but these are the necessary and urgent decisions that I must make.'

Caroline Abrahams, charity director at Age UK, said the move would force households to choose between 'a horrible eating or heating dilemma'.

A series of transport infrastructure projects were also scrapped. A tunnel near Stonehenge to stop traffic tailbacks at the historical site was ditched, along with the A27 Arundel bypass project. And a rail scheme aimed at reopening lines closed as part of the 1960s Beeching cuts was also ditched, including expanding the Ivanhoe line in Leicestershire. Scrapping the schemes will save £785 million by April 2026, the document stated.

The Tories' New Hospital Programme, which aimed to build 40 new hospitals by 2030, will also be reviewed and put on 'a more sustainable footing'.

Rishi Sunak's proposed new qualification, due to bridge the gap between A-levels and T-levels, was also axed, saving £185 million. The document also said that scrapping the Tories' flagship Rwanda deportation scheme for asylum seekers would save £800 million this year.