Reeves admits Budget leaks were 'extremely damaging'

Rachel Reeves has admitted that the briefings and leaks in the run-up to her tax-raising Budget were “extremely damaging” - but has insisted she did not authorise them.

- DAVID MADDOX KATE DEVLIN

The chancellor faced a grilling from MPs about her Budget, with the fallout from the chaos that preceded the fiscal event last month still casting a shadow over her future. She confirmed that a leak inquiry is underway, with officials noting that in the past, people have been sacked over unauthorised briefings.

It came as Ms Reeves confirmed that she and Sir Keir Starmer had decided “as a team” not to raise income tax, as she said there had been “too many leaks” in the weeks before the Budget.

The admission follows a bizarre series of events that took place in November. First, the chancellor gave an emergency press conference, suggesting that she intended to breach a key manifesto promise not to raise income tax. But a few days later, a leak revealed that the party had decided to U-turn on the issue.

Appearing before parliament’s Treasury select committee yesterday, the chancellor told MPs that the “very close partnership” between her and the prime minister meant that the decision to instead extend a freeze on tax thresholds - dragging millions more into paying higher taxes - had been made jointly.

Ms Reeves also said that a Financial Times story, which revealed that she had dropped the plan to raise income tax, had been “incredibly damaging”. She said: “It was not an off-the-record briefing; it was a leak. I’m absolutely categorical that that was not an authorised briefing.”