Rachel Reeves admits she was ‘improper’ on taxes throughout election in Sky News grilling

Rachel Reeves has admitted she was “wrong” about taxes during the general election – but blamed a massive Tory “cover-up”.

After hiking taxes by around £40billion at the Budget, the Chancellor was confronted with comments she made during the campaign on June 11. At the time she told a press conference Labour had “no plans” to increase taxes beyond the proposals set out in Labour’s election-winning manifesto.

But grilled on Sky News’s Sunday Morning With Trevor Philips, Ms Reeves said: “I was wrong on June 11, I didn’t know everything. When I arrived at the Treasury on July 5… I was taken into a room by the senior officials at the Treasury and they set out the huge black hole in the public finances.

“The previous government hid it from the country, they hid it from Parliament, and indeed they hid it from the independent official forecasters at the Office for Budget Responsibility.”

The Chancellor also said ex-PM Rishi Sunak and former Chancellor Jeremy Hunt’s pre-election cut to national insurance for workers were “sold on a false promise”.

Asked why she had supported the cuts at the time, she said: “They were sold on a false premise, the premise being that the money was available. The money clearly wasn’t available, that’s what the £22 billion black hole was.”

She added: “I supported those cuts to national insurance because they were costed and funded, but now what we find out after the election is that the numbers didn’t add up because the government hadn’t revealed to the Office for Budget Responsibility or Parliament the gap between the commitments they were making and the money they had coming in.”

The Budget increased state spending by almost £70 billion per year – funded by a mix of increased taxes and borrowing. The main tax hike was a £25billion raid on employers’ national insurance contributions, with a 1.2 percentage point increase from 13.8% to 15%.

Addressing concerns over the impact on GPs, care homes and hospices of increasing employer NICs, Ms Reeves added: “What the tax increases on Wednesday paid for in part was a £22.6 billion investment into the NHS and the NHS will now make the allocations to GPs, for example.”

She said: “Care homes got in the Budget on Wednesday a £600 million settlement, local government got a 3.2% increase, so above inflation, a real terms increase in spending this week, so I’m confident that those services will carry on running properly.”