Prime Minister Keir Starmer has mounted a robust defence of his government's first major Budget, branding it a "moment of personal pride" while addressing controversies surrounding his Chancellor and setting out his vision for the UK's economic future.
Defending the Budget and a £26bn Tax Rise
In a speech delivered in central London on December 1st, 2025, Starmer staunchly defended Chancellor Rachel Reeves against accusations she misled the public ahead of the fiscal statement. He rejected claims of dishonesty, arguing the government faced a £16 billion shortfall identified in an OBR productivity review, on top of existing commitments to protect the NHS and tackle the cost of living.
The Prime Minister was equally defiant about the decision to raise £26 billion in taxes. He framed it as a necessary choice to avoid cutting public services, ignoring child poverty, or engaging in "reckless borrowing" akin to the Liz Truss premiership. "Politics is always about making choices," Starmer stated, admitting the move would cost people more but was essential for long-term stability.
A New Chapter with Europe and Tackling Low Productivity
Mr Starmer delivered a stark assessment of the UK's recent economic history, directly blaming years of Tory austerity and the botched Brexit deal for holding the country back. He argued these factors were root causes of the nation's chronically low productivity.
Calling for a "grown up" approach, the PM said there was "no credible economic vision for Britain" that did not involve moving towards a closer relationship with the European Union. He acknowledged this would require trade-offs but was vital for economic renewal. This stance was seen as a veiled criticism of Nigel Farage and the Reform party.
Welfare, Child Poverty, and a Path Forward
The Labour leader offered a personal insight into the struggles facing families, recalling a childhood memory of his family's phone being cut off due to unpaid bills. He defended the controversial decision to lift the two-child benefit limit, noting that three-quarters of children in poverty today come from working families.
While vowing to reform the welfare system, with a particular focus on nearly one million young people "not earning or not learning", Starmer refused to be drawn on whether he would suspend Labour MPs who rebel against such reforms. He insisted there was a "strong consensus" on the need for action.
Despite the challenges, the Prime Minister struck an optimistic note, claiming the UK is now through "the narrowest part of the tunnel" on the road to recovery. He pledged that the benefits of his government's approach would become visible in communities across the country in the year ahead.
On the Office for Budget Responsibility's (OBR) error of prematurely publishing the Budget, Starmer called it a "serious error" and a "massive discourtesy to Parliament" but reaffirmed his strong support for the independent fiscal watchdog, describing it as vital for economic stability.
