“Obviously I didn’t lie about the budget forecasts,” Reeves said.
Rachel Reeves said she “of course” did not lie about the state of the public finances ahead of the budget. “Of course I didn’t,” she told Trevor Phillips.
Earlier the Chancellor had told his programme.
In the context of our decline in productivity, which cost £16 billion, I needed to increase taxes, and I was honest and clear about that in the speech I gave at the beginning of November.
Keir Starmer said on Thursday that Reeves’s £26bn tax-hike budget “was laid out in our manifesto”, but acknowledged that Labor had “asked everyone to contribute” in the coming years.
Rachel Reeves speaking to Trevor Phillips on Sky News. He began by replaying a clip of the Chancellor saying last year that the Labor Party would not raise taxes further in future budgets. He says that his statements did not turn out to be true.
Reeves defended this year’s budget, saying it was “not on the scale of last year”, adding that he had to ask people to “contribute more” because the “context” had changed.
Reeves said the OBR decided to review productivity and said the decline in the watchdog’s productivity did not reflect any work done by the Labor government.
Chancellor to defend budget amid deepening controversy over deficit claims
Good morning and welcome to our live coverage of UK politics. Chancellor, Rachel ReevesShe has been embroiled in a politically damaging controversy over what she told the public about the state of the British economy ahead of last week’s budget.
Reeves claimed that a decline in the UK’s projected economic productivity would make it more difficult to meet its self-imposed fiscal rules.
He suggested in a speech on 4 November that tax increases were needed because poor productivity growth would have “consequences on public finances”. Many saw this as an attempt to clear the way for a breach of Labour’s manifesto on income tax by raising rates.
But Office for Budget Responsibility (OBR) – the budget watchdog – said on Friday that it had informed the Chancellor as early as September 17 that rising wages and inflation from the tax reform meant the deficit was smaller than initially expected, and told him in October that it had been completely overstated.
The OBR revelations have prompted opposition figures to urge financial conduct authority (FCA) will investigate whether the Treasury has defrauded the public. Conservatives have accused Reeves of “market abuse”, which is a civil offense. Number 10 has denied that Reeves misled the public on the country’s financial position ahead of the Budget.
Prime Minister, keir starmerHe is expected to lend his support to the budget in a speech tomorrow, saying it will help reduce the cost of living and curb inflation, and will reportedly announce plans to go “further and faster” to stimulate growth.
Reeves will be questioned about the controversy during this morning’s broadcast round, so stay tuned for the latest developments.
<a href