The last Conservative government “deliberately covered up” the true state of public finances, a cabinet minister has said, as the chancellor prepares to detail a “£20bn black hole” in the public finances.
The environment secretary, Steve Reed, said his cabinet colleagues “always knew” the inheritance from the Tories was “going to be bad”, but that since coming to office they had found “additional pressures” that had not been disclosed.
Reed cited as examples the prison overcrowding crisis, and the amount spent on the Rwanda asylum scheme, revealed by the home secretary, Yvette Cooper, to be £700m.
Speaking on BBC One’s Sunday with Laura Kuenssberg programme, Reed said: “We’ve got into our offices now and we’ve seen what’s really been going on, and it’s catastrophic. It’s worse [than expected]. There were things that we could not have known during the election, because the Conservatives had not only not released the information, but in some cases, they deliberately covered it up.”
He questioned whether Tory MPs were “involved in this cover-up” or whether they did not know, and as a result “should be grateful that Rachel Reeves is now exposing the true extent of this catastrophic inheritance from the previous Conservative government”.
Reeves is due to set out the findings of a Treasury audit on Monday and will also announce the date of the spending review and the budget in October.
Experts expect she will be forced to announce tax changes in the budget, with options including new capital gains or inheritance taxes and slashing other tax reliefs. The chancellor has ruled out changes to income tax, VAT, national insurance and corporation tax – the largest revenue raisers.