Shadow chancellor Rachel Reeves has received a standing ovation at the Labour Party conference after accusing the government of recklessly gambling with the nation’s finances.
Taking to the stage in Liverpool on Monday (September 26) – the Labour MP said that Chancellor Kwasi Kwarteng was “fanned the flames” of the plummeting pound by hinting at fresh “unfunded” tax cuts, after sterling hit an all-time low against the dollar.
The pound fell to the lowest level against the US dollar since decimalisation in 1971, dropping by more than 4 per cent to just 1.03 dollars before gaining some ground as trading picked up on Monday.
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Over the weekend Mr Kwarteng sought to brush off questions about the markets’ reaction to the biggest programme of tax cuts for 50 years, which he announced on Friday, and even said there is “more to come”.
Talking from the Labour conference in Liverpool, Ms Reeves said: “It is incredibly concerning.
“I think many people had hoped over the weekend things would calm down, but I do think the Chancellor sort of fanned the flames on Sunday in suggesting there may be more stimulus, more unfunded tax cuts, which has resulted overnight in the pound falling to an all-time low against the dollar.”
The shadow chancellor doubled down on her comparison of Mr Kwarteng and the prime minister to “two gamblers in a casino chasing a losing run” and warned they are betting with the nation’s finances.
“Here’s the thing, they’re not gambling their money, they’re gambling all of our money, that’s why it’s irresponsible and reckless as well as being grossly unfair,” Ms Reeves said.
Ms Reeves suggested Labour would pay for the tax cut with borrowing, warning it was just the scale of the Government’s borrowing that had “spooked the markets”.
“When I set out my fiscal rules last year, I said that in emergency situations – and we are absolutely in a national emergency at the moment – you can borrow and the Government is borrowing, it’s the scale of the borrowing…” she said.
Ms Reeves was preparing to use her party conference speech to announce that a Labour government would create a state-owned investment fund to back projects which could generate wealth for the nation.
The fund would begin with an initial £8.3 billion investment to fund green industries.
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