The Chancellor is expected to unveil a black hole in the public finances of around £20billion, signalling that tax rises could be on the way.
Rachel Reeves is due to set out the results of the spending audit she ordered Treasury officials to produce. A Labour source said the update later today will reveal “the true scale of the damage the Conservatives have done to the public finances.”
Labour has previously ruled out lifting income tax, VAT, national insurance and corporation tax, however changes to capital gains or inheritance levies may be on the table.
The Labour source said: “On Monday, the British public are finally going to see the true scale of the damage the Conservatives have done to the public finances. They spent taxpayers’ money like no tomorrow because they knew someone else would have to pick up the bill.
“It now falls to Labour to fix the foundations of our economy and that work has already begun.”
Sir Keir Starmer has already vowed there will be no “return to austerity”, in reference to the deep cuts imposed by George Osborne when the Coalition took power in 2010.
It follows a rebellion within his own party on the two-child benefit cap where seven MPs, including former Shadow Chancellor John McDonnell and former shadow Education Secretary Rebecca Long-Bailey, all lost the whip.
Reeves accuses Tories of spending taxpayer money ‘like no tomorrow’
Rachel Reeves said that Labour will ‘fix the mess’
PA
Asked about the black hole at a meeting of G20 finance ministers in Brazil, the Chancellor said: “I’ll give a statement to Parliament on Monday, but I have always been honest about the scale of the challenge we face as an incoming Government, and let me be crystal clear: we will fix the mess we have inherited.”
The Labour source said: “On Monday, the British public are finally going to see the true scale of the damage the Conservatives have done to the public finances.
“They spent taxpayers’ money like no tomorrow because they knew someone else would have to pick up the bill. It now falls to Labour to fix the foundations of our economy and that work has already begun.”