Keir Starmer: Truss government has ‘lost control of UK economy’, says Labour leader

Britain’s Labour opposition leader Sir Keir Starmer has accused the government of having “lost control of the British economy”, at a time when market turmoil over Prime Minister Liz Truss’ radical tax-cutting plan risks compounding a cost-of-living crisis.

His speech to the party’s annual conference in Liverpool comes as a new opinion poll suggests Labour has risen to its largest poll lead in more than two decades over the ruling Conservatives.

The opposition party is 17 points ahead of the Tories, a level of support not seen since 2001 when Labour’s Tony Blair was prime minister, according to the YouGov poll.

Although Russia’s war in Ukraine had sparked the energy crisis, Starmer said that did not spare the government blame for disastrous policy moves. Labour, he said, would stand by Ukraine and “never allow imperialism to succeed”.

His address has been trailed as a bid to reclaim the “centre-ground” of British politics, including promises that a Labour government would create jobs, improve skills and tackle climate change rather than cut taxes for the wealthiest.

Fewer than three weeks since Truss took over from Boris Johnson as prime minister, her government took a significant swerve to the right economically which has spooked financial markets and Conservative backbenchers alike.

Last Friday the Chancellor of the Exchequer (finance minister) Kwasi Kwarteng unleashed historic tax cuts, ditched a cap on bankers’ bonuses and announced huge increases in borrowing in a fiscal statement that sent markets into a tailspin. 

Starmer said the events of recent days had no precedent. “The government has crashed the pound,” he told the party conference, adding that “they did all this not for you, not for working people, but for tax cuts for the richest one per cent in society”.

“Trickle-down economics doesn’t work,” he added later in his speech.

The Labour leader has pledged to reverse the abolition of the top rate of income tax and restore it to 45%, and to recommit to an Office for Value for Money to oversee taxpayers’ money and ensure it is spent in the national interest. He also announced plans for a state-owned energy company.

Labour’s standing has improved dramatically even compared to just a year ago, when battles with leftist supporters of former leader Jeremy Corbyn underscored the deep divisions in the party after a punishing election defeat in 2019.