Keir Starmer is stepping in to address the cost of living crisis in a bid to stabilize the Budget following controversy involving Rachel Reeves.

This intervention by the Prime Minister follows accusations against Reeves, alleging she misled both the public and financial markets. The accusations stem from claims that she was informed months prior by the Treasury’s watchdog that there was no deficit in the public finances.

Starmer has now vowed to tackle the ongoing cost of living issues as the Conservatives have formally reported the Chancellor to the financial watchdog for purportedly “misleading” statements.

Reports from Saturday night suggest that Downing Street was aware of the reality when Reeves cautioned about “hard choices” amid speculation of a £30 billion shortfall in the country’s finances.

However, the Office for Budget Responsibility (OBR) disclosed on Friday that it had previously advised the Treasury of an actual £4.2 billion surplus.

When questioned about whether Sir Keir knew of the OBR’s clarification that the economic outlook was more positive than perceived, a spokesperson from No 10 stated, “The Prime Minister and Chancellor collaborated on the Budget, which involved making fair and necessary decisions.”

It appears the Prime Minister is now trying to pivot the conversation by talking about his long-term growth plans in a speech on Monday, when he will praise the budget for providing ‘economic stability’ and claim that ‘economic growth is beating the forecasts’, the Times has reported. 

Starmer will vow to scrap ‘misguided’ regulations and address any unforeseen costs, as well as confirm that he is implementing reforms to the way nuclear power plants are built after it was revealed that Britain was the most expensive place in the world to build nuclear power. 

Keir Starmer has said he will intervene in the cost of living crisis this week in a bid to save the Budget

Voters have called for Labour Chancellor Rachel Reeves to resign after she delivered her dreaded budget on Wednesday

In the speech, it will also be announced that Business Secretary Peter Kyle will take the same deregulatory approach to all large infrastructure projects, in a desperate bid to speed up delivery. 

Starmer will finish by praising Ms Reeves’ Budget for delivering ‘economic stability’ and setting the agenda for future growth.  

But Starmer’s bid to rescue the Budget comes as his Chancellor continues to face fierce criticism over her Budget, as the Conservatives launched a public petition calling for Rachel Reeves to be sacked. 

Reform UK leader Nigel Farage told the MoS: ‘We have a deceitful Prime Minister and Chancellor and both should go. Business has no confidence left in these two.’ 

Speaking to the Mail, Tory leader Kemi Badenoch said of Ms Reeves: ‘She seems to think she can create her own alternative reality and that people will just buy it. That’s what I was alluding to in my Budget speech when I said she’s taking the public for fools. 

‘We learn now the OBR actually told her, ‘You don’t necessarily need to do this.’ And she did it anyway. That is dishonest. 

‘That is yet another example of this woman being out of her depth, and in the wrong job.’ 

In other developments:

• Shadow Chancellor Mel Stride has asked the Financial Conduct Authority for a full investigation ‘into possible market abuse by all those who would have had access to confidential information including at HM Treasury and 10 Downing Street’ on the grounds that markets could have been manipulated by knowingly false statements;
• Ms Reeves denied misleading the public, telling The Guardian that the tax raid was still ‘fair and necessary’ – despite knowing her deficit had disappeared – because the wealthy should share more of the economic ‘burden’; 
• A Treasury minister is said to have hinted that Labour would take revenge on the OBR for revealing its private advice to the Chancellor, by suggesting the Government had ‘big plans’ for the watchdog next year;
• Ms Reeves is likely to be forced to appear in the Commons for an emergency statement on the issue on Monday, as ministers admit to the MoS that the situation looks ‘serious’ for the Government.

Even one Cabinet minister on Saturday night admitted Ms Reeves was in a perilous position because Labour colleagues had been forced to support the line that there had been a fiscal black hole. 

He told the MoS: ‘It’s serious. The problem is, Labour MPs bought into this.’ 

Downing Street indicated that Sir Keir Starmer had been aware there was a £4.2billion surplus in public finances even as Ms Reeves warned of ‘hard choices’ amid reports of a £30bn ‘black hole’

Tory leader Kemi Badenoch told the MoS that Ms Reeves was living in an ‘alternative reality’

Other angry Labour MPs made it clear that the Chancellor’s position was hanging by a thread. Ex-minister Graham Stringer said: ‘Under similar circumstances, no Chancellor would expect to remain in office. To do so, Rachel Reeves has a lot of explaining to do, to MPs and the public.’ 

Amid expectations that Opposition MPs will on Monday demand the Chancellor answers questions in the Commons, Mr Stringer added: ‘If there is an urgent question on this, the Chancellor herself must come to the House – not take the coward’s way out and send one of her underlings instead.’ 

A Mail on Sunday poll found a majority of more than two to one in favour of her quitting after the fiscal watchdog revealed it told the Chancellor months ago that there was no hole in the public finances, as she had claimed. 

Another Labour MP vented his fury that colleagues had been ‘marched up a hill’ by Ms Reeves to defend the possibility of a manifesto-breaking rise in income tax, rates – which had been widely leaked ahead of the Budget – only for the Chancellor to abandon the plan. 

The MP said: ‘She lied about the fiscal black hole – the OBR said it did not exist.’ 

However, the MP suggested Ms Reeves would survive the current crisis but only because the Prime Minister would not stay in office without her as Chancellor. He said: ‘If she goes, Keir goes.’ 

In the MoS poll, 68 per cent of voters thought Ms Reeves should resign, compared to 32 per cent who think she should stay.  

The MoS survey, by Find Out Now, also found that 65 per cent of voters think that the Labour Government will fall before the end of its five-year term in 2029.

Meanwhile, visitors to the Daily Mail website on Saturday overwhelmingly called for Ms Reeves to resign, with 97 per cent of the 87,541 people who voted demanding she quit.

Find Out Now surveyed 2,002 British adults on November 29.