Sir Keir Starmer has refused to repeat a promise made by the chancellor that the government will not raise any more borrowing or taxes.
Tory leader Kemi Badenoch challenged the prime minister to double down on Rachel Reeves’ commitment at the Confederation of British Industry (CBI) conference on Monday.
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Ms Reeves told business leaders she is “not coming back with more borrowing or more taxes” as she defended measures announced in her budget.
Asked to repeat the pledge, Sir Keir told Prime Minister’s Questions (PMQs): “I’m not going to write the next five years of budgets here at this despatch box.
“We said we wouldn’t hit the pay slips of working people. We passed the budget, we invested in the future, and kept that promise.”
Ms Reeves’ budget has faced sharp criticism from major UK businesses who have said the costly policy measures will force them to raise prices and cut jobs.
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The chancellor announced £40bn worth of tax rises, with the lion’s share coming from a £25bn increase in employers’ National Insurance (NI) contributions.
Critics include the boss of biscuit giant McVitie’s, who warned it was “becoming harder to understand” the case for investing in the UK after the chancellor’s decisions.
Ms Badenoch seized on those comments, saying that “while the prime minister has been hobnobbing in Brazil” – referring to his attendance at last week’s G20 Summit – “businesses have been struggling to digest his budget”.
Responding, Sir Keir accused her of “wanting all the benefits of the budget” without paying for it.
He claimed she had “racked up £6.7bn of unfunded commitments in just three weeks as leader of the opposition” and noted that she hasn’t said if the Conservatives would actually reverse the government’s NI rise.
“They really haven’t got a clue what they’re doing,” he added.
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The employer NI rise was the most controversial element of Labour’s budget, as they had promised during the election campaign that national insurance wouldn’t go up, alongside income tax and VAT.
Ministers later said the NI pledge only applied to the employee element of the levy, noting their manifesto had specified taxes wouldn’t rise for “working people”.
The government has justified raising employer NI by saying the Tories left behind a £22bn black hole in the country’s finances, and investment into public services like the NHS is needed for long-term growth.
Reeves: ‘We’ve wiped the slate clean’
Ms Reeves was asked again on Wednesday how she can guarantee she will not need to put up taxes or increase borrowing again, given scepticism around the budget measures.
She did not go as far as what she said on Monday, following a line closer to what Sir Keir said at PMQs.
“I’m not going to write five years worth of budgets in the first few months as Chancellor of the Exchequer,” she told reporters.
“What I can now say is that we have wiped the slate clean on the economic and fiscal mismanagement of the previous government. We’ve put our public finances on a firm footing and we’ve properly funded our public services.
“And public services now need to live within the means that we’ve set them for the duration of this parliament.”
