Starmer warns of 'painful' Budget to repair Tory 'rot'

Sir Keir Starmer has admitted that the country is set to be hit with a painful Budget” in October as his new Labour government tries to fix the rot” left by the Tories.

- DAVID MADDOX

Speaking to a group of 50 voters and supporters in the Downing Street rose garden, the prime minister hinted at more spending cuts and tax rises to come as his party attempts to close a £22bn black hole they claim to have found in the public finances.

He warned that “things are worse than we ever imagined” because of a £22bn “black hole” in the public finances, claiming to have found out last week that the Tories had borrowed almost £5bn more than the Office for Budget Responsibility (OBR) expected.

While he insisted that his top priority is still wealth creation, it is now widely expected that his government will hit a number of taxes including capital gains and inheritance tax to fill the gaps in public spending.

He said: “There is a Budget coming in October, and it’s going to be painful. We have no other choice, given the situation that we’re in. Those with the broadest shoulders should bear the heavier burden, and that’s why we’re cracking down on nondoms. Those who made the mess should have to do their bit to clean it up – that’s why we’re strengthening the powers of the water regulator and backing tough fines on the water companies that let sewage flood our rivers, lakes and seas.”

It came as Sir Keir defended his chancellor Rachel Reeves’s decision to means test winter fuel allowance payments to pensioners, which Age Concern has warned will leave thousands at risk this winter.

He said: “I didn’t want to have to deal with the winter fuel allowance for pensioners ... We have to fix the NHS, we have to fix our homes, our schools, and pensioners rely on them in the same way as everybody else does, so I’m not going to pre-empt the Budget, but I am absolutely not going to accept that the inheritance that we have is anything other than dire – a £22bn black hole.”