Rachel Reeves accused of ‘misleading’ UK over £20bn Budget black hole – live updates

Paul Johnson, a former head of the Institute for Fiscal Studies (IFS) think tank, said “it probably was misleading”.

“It was designed to confirm a narrative that there was a fiscal black hole that needed to be filled with significant tax rises,” he told The Times. “In fact, as she knew at the time, no such hole existed.”

Downing Street was asked on Friday whether Ms Reeves’ warnings of coming difficult decisions despite the OBR’s improved forecasting meant she had misled the public and the markets in the run-up to the Budget.

“I don’t accept that,” the Prime Minister’s official spokesman said.

He added: “As she set out in the speech that she gave here (Downing Street), she talked about the challenges the country was facing and she set out her decisions incredibly clearly at the Budget.”

Kemi Badenoch called for the chancellor to lose her job amid accusations she misled Britain over the state of public finances.

“Yet more evidence, as if we needed it, that the Chancellor must be sacked,” the opposition leader said on Friday.

“For months Reeves has lied to the public to justify record tax hikes to pay for more welfare.”

“Her Budget wasn’t about stability. It was about politics: bribing Labour MPs to save her own skin. Shameful.”

The Chancellor was accused of misleading Britain over her assessment of the state of public finances ahead of the budget.

The Office for Budget Responsibility (OBR) said on Friday that a downgrade in productivity forecasts that Rachel Reeves had used to illustrate the “challenges” facing the nation had been more than offset by a rise in tax revenues due to inflation.

Richard Hughes, chairman of the OBR, wrote to the Treasury select committee and revealed that Reeves had been told in September that the OBR had only made small downgrades to its overall assessment.

Reeves had warned it would have “consequences” for people’s jobs and wages, and said she would have to raise taxes as a result.

Labour faces scrutiny over the decision to raise taxes in the budget, which the Institute for Fiscal Studies (IFS) think tank said amounts to a breach of manifesto promises. The prime minister has refuted the charge.

French police will intercept small boats at sea in an attempt to stop migrants crossing the Channel.

A document seen by French newspaper Le Monde, signed by four prefectures in the north of France, agrees that maritime police will start “planned operations” to intercept the dinghies. The push-backs will start initially at sea, and then be conducted in the “inland waters” of ports and channels, the paper reported.

Holly Bancroft has the full story:

Businesses are preparing to slow hiring as a result of measures in the autumn Budget, which puts Britain on course for a record tax burden, a new snap poll suggests.

Some 56 per cent of business leaders said there were likely to be fewer hires than originally planned.

The poll of 500 business leaders was carried out by WPI Strategy and polling firm Merlin Strategy to gauge sentiment among businesses in the immediate aftermath of Wednesday’s Budget statement.

The extended freeze on income tax thresholds is seen as the most damaging impact of the Budget, with 47 per cent of business leaders saying it will have a negative impact on their business and staff, the survey showed.

Despite this, 45 per cent said it was a justified measure to raise revenue.

The poll also showed that 56 per cent of respondents felt it would have been better for the Government to raise income tax but leave all other taxes as they are.

Meanwhile, about two-thirds of business leaders fear they will be targeted with further tax rises in the near future.

The Employment Rights Bill is now expected to make only parental leave and sick pay available from day one of the job for all workers.

However, protection from unfair dismissal will now only be secured after six months, rather than on day one as was the case when the bill was introduced.

Here is an overview of how the bill will change the workplace for employees across the UK:

Backbench MPs and trade union have urged Sir Keir Starmer to reverse his u-turn on workers’ rights.

Labour MP for Middlesbrough and Thornaby East, Andy McDonald, branded the move a “complete betrayal” and vowed to push for its reversal.

He said: “we cannot support that halfway measure”, adding: “This is a wrong-headed move and I will campaign to have this concession reversed.”

Labour affiliated transport and travel union TSSA also urged the government to reinstate its plans to give workers the right to claim unfair dismissal from day one in the job.

“Our union has long campaigned for strong, meaningful rights from the first day of employment, arguing that day one protection is essential to safeguard workers from arbitrary and unjust treatment,” TSSA General Secretary, Maryam Eslamdoust said.

“This remains our position and it’s vital that the government thinks again about this damaging u-turn.”

Business groups welcomed Thursday’s concession, saying the qualifying period of six months was “crucial for businesses’ confidence to hire and to support employment, at the same time as protecting workers”.

The six business groups involved in discussions – including the British Chambers of Commerce, Confederation of British Industry, and Federation of Small Businesses – said the change addresses the “key problem that must be sorted in primary legislation”.

However, they warned that firms would “still have concerns” about many of the powers within the Bill, including thresholds for industrial action, guaranteed hours contracts and seasonal and temporary workers.