Rachel Reeves has refused to repeat her promise not to have to put up taxes or borrowing again in future Budgets.
The chancellor hiked taxes by £40 billion in her first Budget in October, including an increase in the employers’ rate of National Insurance.
Last week Reeves told the annual conference of the Confederation of British Industry (CBI) that the government had “set the budgets for public services for the duration of this parliament”.
She added: “Public services now need to live within their means, because I’m really clear, I’m not coming back with more borrowing or more taxes.”
But the chancellor has repeatedly failed to make that pledge again, and Keir Starmer also refused to back up her words when pressed in the Commons.
Speaking at a business event in Hull last night, Reeves once again stopped short of repeating her pledge not to put up taxes again before the next election, but did insist that public services would have to “live within their means”.
She said: “That’s going to mean difficult decisions come the spring on public spending, but public services do now need to live within their means, because I’m not going to coming back with another load of tax rises or indeed higher borrowing to fund this.”
But Reeves later told reporters she could not “write five years’ worth of budgets in just five months”.
“We don’t know what might happen in the future in terms of shocks to the economy, but I can give businesses the confidence in this budget we have wiped the slate clean, we will never have to do a Budget like this again,” she said.
In the Commons yesterday, Reeves was repeatedly pressed on her previous comments by Tory MPs.
Shadow chancellor Mel Stride asked the chancellor “spoke without thinking” when she told business chiefs she would not repeat her Budget tax hikes.
Reeves replied that the Government would “never have to repeat a Budget like that”.
Richard Fuller, the shadow chief secretary to the Treasury, said: “Rachel Reeves is again undermining business confidence.
“She told the CBI last week ‘there would be no more borrowing, and no more taxes’. Days later the business secretary and then the prime minister refused to stand by what she said. Now even she cannot repeat her own words.
“How can businesses be expected to create jobs, growth and wealth in the economy when the government offers neither stability or credibility?”