Labour will this week launch a desperate fightback for support after the crushing by-election defeat at the hands of the Greens.
Chancellor Rachel Reeves will claim in her Spring Statement on Tuesday that ‘green shoots’ of recovery in the economy are helping to ease the cost-of-living crisis and vindicates her decision to hammer companies with £25 billion of taxes in her Budget.
She is also expected to point to positive figures on business confidence, retail sales and inflation.
It comes after new Green MP Hannah Spencer, victor in the Gorton and Denton by-election, repeatedly raised during her campaign how ordinary voters were struggling to make ends meet.
She talked of how instead of working hard ‘to get you somewhere’, people were instead being ‘bled dry’.
In a bid to fight back, the coming weeks will also be ‘busy’ with ‘red meat’ announcements for Labour MPs, with Ms Reeves ‘out and about’ as her policies come into force, including minimum wage and pension triple-lock uplifts.
The Chancellor is also planning a Mais Lecture – given to leaders in economics and finance – to help bolster her economic credibility, in which she will focus on the ‘growth agenda’ and claim she is putting more money in people’s pockets.
In addition, Ms Reeves plans to ambush City commuters by taking over the Tannoy system at London’s Liverpool Street Station to trumpet rail fare freezes.
Chancellor Rachel Reeves will claim the ‘green shoots’ of economic recovery are visible in her Spring Statement on Tuesday
Insiders hope the moves will placate ‘jumpy’ Labour backbenchers who have become nervous after the election result.
But one Government source denied last night that Ms Reeves’ approach is a response to the defeat.
They said: ‘Just because the Greens have decided for half a second that they care about working people, it isn’t fooling anybody. We are the party that cares about that. This is Rachel’s number one priority.’
Downbeat Labour insiders said the response showed the level of desperation inside No 10 after a bruising few weeks.
But one insisted that focusing on the cost of living was something MPs can ‘rally behind’.
A Treasury source claimed the Chancellor’s message was ‘what everyone wants to hear’.