Labour now less trusted on the economy than Liz Truss, damning new poll finds

Asked who they would trust with the economy, 10 per cent of people said Labour - fewer than those who said they would trust Liz Truss

Sir Keir Starmer’s government is now less trusted on the economy than the Conservatives were under Liz Truss, a damning new poll has revealed.

Asked who they would trust with the economy, a YouGov poll showed 10 per cent of people said Labour - fewer than those who said they would trust Ms Truss, who presided over a shambolic tenure of the economy as prime minister.

Some 17 per cent said they would trust the Tories on the economy, 13 per cent said they would trust Reform UK, 8 per cent said they would trust the Green Party and 5 per cent said they would trust the Lib Dems.

In October 2022, the month after her disastrous mini-budget which spooked the financial markets in 2022 and led to a spike in mortgage rates and her eventual resignation, some 15 per cent of voters said they would trust the Conservatives with the economy.

Ms Truss, who was famously outlasted in power by a lettuce, has defended her time as prime minister and repeatedly blamed a “failed Treasury orthodoxy” for problems during her premiership.

The dire polling comes as the chancellor faces accusations of lying about Britain’s finances in the run-up to the Budget in order to justify £26bn worth of tax hikes.

On Monday, just five days after Rachel Reeves delivered the Budget, Sir Keir Starmer was forced to come out fighting with a speech insisting there was “no misleading” by his chancellor amid questions growing over his own future.

The row centres on a press conference given by Ms Reeves in November, in which she warned of the state of the public finances and suggested that income tax may have to go up.

It has since emerged that she failed to reveal information from the Office for Budget Responsibility (OBR) that showed tax receipts were much better than expected, ahead of her announcing sweeping tax rises.

The PM, speaking 24 hours after Ms Reeves denied lying over the state of the public finances before the Budget, was repeatedly forced to come out on the defensive as he gave a speech highlighting the “moral mission” of his government in tackling child poverty.

The damning YouGov poll, commissioned by Sky News, found that more than a third of people think Ms Reeves exaggerated economic bad news in the run-up to the Budget - twice as many as those who thought she was honest.

Some 37 per cent of people said they thought the chancellor said things were worse than they actually were, while just 18 per cent said they thought she was honest. Around 13 per cent said they thought things were better than she made out.

And in a damning verdict of the measures she unveiled last week, just 8 per cent of people said they think the Budget will leave the country better off. A tiny 2 per cent said they think the measures will leave them and their family better off.

Some 52 per cent think the country will be worse off, while 50 per cent think they and their family will be worse off.

It came as ministers were openly briefing about how they too had been misled by Sir Keir and Ms Reeves, with one tellingThe Independent that the aftermath of the Budget was “less than ideal”.

The YouGov poll spoke to 3,416 adults between November 30 and December 1.

Starmer to chair Cabinet amid Budget fallout

Sir Keir Starmer will convene his top ministers on Tuesday amid the fallout from last week’s tax-raising Budget.

The weekly Cabinet meeting comes after the resignation of Budget watchdog chief Richard Hughes and an ongoing row over whether the Chancellor “misled” the country over the state of the public finances.

Mr Hughes quit as chairman of the Office for Budget Responsibility (OBR) on Monday following an investigation into the accidental publication of economic forecasts almost an hour before Rachel Reeves delivered her Budget.

The investigation found the incident was “the worst failure” in the organisation’s history, and Mr Hughes said he was leaving to allow the OBR to “quickly move on”.

In a letter replying to his resignation, Ms Reeves said he had led the OBR “with great commitment and integrity” and praised his “achievements” in the role.

Meanwhile, both Sir Keir and Ms Reeves have denied claims the Chancellor misled voters by talking up the impact of a downgrade in the OBR’s productivity forecasts.

The Chancellor in part blamed the £26 billion of tax rises in the Budget on the downgrade, which delivered a £16 billion hit to tax revenues.

Although an increase in tax receipts due to inflation and higher wages cancelled some of this out, the Chancellor said a forecast showing a £4.2 billion surplus against her borrowing rules did not include policies such as the abolition of the two-child benefit cap.

And she also rejected a report in The Times from an unnamed minister who claimed the Cabinet was “at no point” told about the “reality” of the OBR forecasts.

Speaking to BBC Wales, she said the Cabinet had been briefed on the Budget on the morning it was delivered, but “you would never expect the Prime Minister and Chancellor to go through all the detailed numbers”.

Tuesday will also see the conclusion of the Budget debate in the Commons, where the Conservatives continue to call for Ms Reeves to resign over her handling of the economy.