Labour accused of planning to raise taxes 'all along' as Starmer warns of 'unpopular decisions' ahead of budget
27 August 2024, 21:39 | Updated: 27 August 2024, 23:19
The Prime Minister has warned Labour will have to make 'unpopular' decisions and a painful budget in October.
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Sir Keir Starmer has asked the country to "accept short-term pain - for long-term good" in a speech ahead of the budget next month.
He has claimed there is a £22 billion "black hole" in public finances.
The Prime Minister vowed the government will "do the hard work" in power, and claimed recent riots showed "the cracks in our society after 14 years of populism and failure" in a major speech from Downing Street today.
Former Prime Minister Rishi Sunak says it's evidence Labour had planned to raise taxes all along.
Speaking from the rose garden, Keir Starmer defended his government's decision to means test the winter fuel payment, cutting support for millions of pensioners
The PM also claimed his government has done more for the country in seven weeks than the Conservatives achieved in the last seven years.
Sir Keir said "things are worse than we ever imagined", as he told a press conference: "In the first few weeks we discovered a £22 billion black hole in the public finances and before anyone says 'Oh this is just performative or playing politics' let's remember the OBR (Office for Budget Responsibility) did not know about it, they wrote a letter setting that out.
"They didn't know because the last government hid it and even last Wednesday, just last Wednesday, we found out that thanks to the last government's recklessness we borrowed almost £5 billion more than the OBR expected in the last three months alone. That's not performative, that's fact."
The PM warned that the upcoming October budget would be "painful", hinting working Brits should expect tax rises in the short term to fix "societal rot".
Sir Keir Starmer said there is a need to be "honest with people about the choices that we face", as he said: "How tough this will be and, frankly, things will get worse before they get better."
He said: "I didn't want to release prisoners early, I was chief prosecutor for five years, it goes against the grain of everything I've ever done, but to be blunt, if we hadn't taken that difficult decision immediately, we wouldn't have been able to respond to the riots as we did.
"And if we don't take tough action across the board, we won't be able to fix the foundations of the country as we need.
"I didn't want to means test the winter fuel payment, but it was a choice that we had to make, a choice to protect the most vulnerable pensioners while doing what is necessary to repair the public finances."
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His Chancellor Rachel Reeves is expected to raise taxes and cut public services this October, after warning that she had found a £22 billion "black hole" in the public finances she inherited from the Conservatives.
Her predecessor Jeremy Hunt denies this, and some economists have said Ms Reeves would have known about the state of Britain's finances before she came to power.
The speech and press conference, ahead of MPs returning to Westminster on Monday, marked an attempt by Sir Keir to manage expectations about the time needed to turn things around - he has previously spoken about the need for a "decade of national renewal", implying at least two terms of Labour rule.
"Next week, Parliament will return. The business of politics will resume, but it will not be business as usual," he said.
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"Because we can't go on like this anymore. No more politics of performance, papering over the cracks, or division and distraction. Things are being done differently now.
"When I stood on the steps of Downing Street two months ago, I promised this Government would serve people like you: apprentices, teachers, nurses, small-business owners, firefighters - those serving the community and the country every day.
"I promised that we would get a grip on the problems we face, and that we would be judged by our actions, not by our words."
He added: "We will do the hard work needed to root out 14 years of rot and reverse a decade of decline.
"We'll fix the foundations, protecting taxpayers' money and people's living standards. We'll reform our planning system to build the new homes we need.
"We'll level up workers' rights so people have security, dignity and respect. We'll strengthen our border security. We'll crack down on crime. We'll transform public transport. And we'll give our children the opportunities they need to succeed."
Speaking of the riots that swept across the country throughout August, Sir Keir slammed a "mindless minority of thugs" that thought they "could get away with causing chaos."
He said: "Now they'll learn that crime has consequences, that I won't tolerate a breakdown in law and order under any circumstances and I will not listen to those who exploit grieving families and disrespect local communities.
"But these riots didn't happen in a vacuum, they exposed the state of our country, revealed a deeply unhealthy society, the cracks in our foundations laid bare, weakened by a decade of division and decline, infected by a spiral of populism which fed off cycles of failure of the last government.
"Every time they faced a difficult problem they failed to be honest, they offered the snake oil of populism which led to more failure - round and round and round. Stuck in the rut of the politics of performance."
Championing his government's acheivments since they came to power, Sir Keir said: "I said before the election, and I say it again really clearly today, growth - and frankly, by that, I do mean wealth creation - is the number one priority of this Labour Government.
"And that's why in our first few weeks, we've set up the National Wealth Fund because we want every person and every community to benefit.
"It's why we've unlocked planning decisions, because we're going to build 1.5 million new homes. It's why we set up Great British Energy, to create good jobs and cut people's bills. And it's why we ended the national strikes that have crippled our country for years.
"Because I defy anyone to tell me that you can grow the economy when people can't get to work, because the transport system is broken, or can't return to work because they're stuck on an NHS waiting list.
"We've done more in seven weeks than the last government did in seven years. And these are just the first steps towards the change that people voted for, the change that I'm determined to deliver."
