Rachel Reeves promises ‘iron discipline’ in Labour conference speech as Mark Carney weighs in for shadow chancellor

Rachel Reeves declared Labour “ready to serve, lead and rebuild Britain” on Monday as she unveiled her vision for the nation with her party feeling power tantalising within its grasp.

The shadow chancellor promised “iron discipline” to restore Britain’s “dire” public finances and won a resounding endorsement from former Bank of England governor Mark Carney who said it was “beyond time we put her energy and ideas into action”.

But she also warned of “tough choices” if Labour wins power, refusing to pledge tax cuts in the next Parliament where there would be a focus on improving the NHS and other public services.

In her keynote speech to Labour’s annual rally in Liverpool, she hailed a “momentous week” but also warn against “complacency” after Sir Keir Starmer had restored the party from its 2019 election disaster under Jeremy Corbyn.

“It falls to us to show that Labour is ready to serve,” she was due to tell the party faithful. “Ready to lead … and ready to rebuild Britain.”

Amid accusations that Labour is policy-lite, Ms Reeves announced:

* A new “star chamber-style” acceleration unit would be set up in Downing Street if Labour wins power to ensure major projects like HS2 do not fall behind schedule and soar over budget.

Delegates applaud on day two of the Labour Party conference (Getty Images)

* Shadow chief secretary Darren Jones would start now with work to “examine line by line every ongoing major capital project” with industry experts.

* The Government would aim to halve spending on consultants in Whitehall over the next Parliament to save £1.4 billion.

* A “Covid Corruption Commissioner” would scrutinise pandemic contracts to seek to recover at least £2.6 billion “lost to fraud, waste and non-delivery”.

* Targeting Rishi Sunak’s flying to meetings, a clampdown on ministerial use of private jets would be introduced.

Shadow chancellor Rachel Reeves with party leader Sir Keir Starmer before making her keynote speech (PA)

With Labour seeking to convince the nation to trust it on the economy, former Bank of England official Ms Reeves was endorsed by Mr Carney in a video message to the conference, packed with delegates and businesses.

“Rachel Reeves is a serious economist… she understands the economics of work, of place and family,” he said. Ms Reeves pledged to give Britain “higher living standards, thriving high streets and good jobs” on a wave of economic growth which would be Labour’s “No 1 mission”, stressing raising the rate to the level in the New Labour years would bring in an additional tens of billions.

But the Institute for Fiscal Studies warned that it would be “very hard” to improve public services without additional tax rises. Its director Paul Johnson said: “I’m not convinced that either a Labour or a Conservative government could do that.”

Ms Reeves told ITV’s Good Morning Britain: “I would like taxes on working people to be lower but I’m not going to play fast and loose with the public finances and make any promises that I won’t be able to keep.”

She emphasied that Labour would pay for day-to-day spending with tax receipts, cut the nation’s debt as a share of the economy, but also did not rule out borrowing to invest based on predictions by the Office for Budget Responsibility that debt would fall. While stressing her “iron clad” approach, Labour’s plans are likely to be seen as heavily reliant on economic growth.

Stressing that global economics had been changed by the pandemic, Ukraine and other threats, Ms Reeves was due to outline her concept of “securonomics” to protect Britain and families up and down the country from financial shocks. “In short: globalisation, as we once knew it, is dead,” she was set to say. A new business model would mean “we must rebuild our ability to make, do and sell here in Britain”.

She hit back at critics on the Left who accused her of adopting plans similar to the Tories. “Hard choices, but Labour choices,” she said.

She stressed that in her first Budget, she would end the tax loophole which exempts private schools from VAT and business rates, and the stamp duty surcharge on overseas home buyers would be raised. Labour would aim to restore business investment as a share of GDP to the level it was under the last Labour government, which Ms Reeves said would add £50 billion annually to GDP.