SHADOW chancellor Rachel Reeves has denied her plans to bring in more money for public spending are “crumbs” – as she faces questions over whether Labour will continue Tory cuts.

The top Labour MP is under pressure to outline whether her party would continue Tory cuts amid warnings new measures announced in last week’s Budget will result in major reductions in state spending.

Speaking on the BBC’s Sunday with Laura Kuenssberg, Reeves said there would be an initial “injection of cash” into public spending if Labour came to power at the next General Election.

But it remains unclear how the party will fund this, with Labour tied into Tory spending rules which aim to reduce debt as a percentage of gross domestic product (GDP).

They were also blindsided by last week's Budget which saw Chancellor Jeremy Hunt pinch key planks of the party's revenue-raising plans, including phasing out non-dom status. 

This has left Labour scrambling to work out how to pay for past commitments such as free breakfasts for schoolchildren and improvements in the NHS. 

Labour are also reluctant to announce any increases in taxation and insist they have a plan to grow the economy.

READ MORE: Jeremy Hunt snubs Scottish Tory pleas with windfall tax extension in Budget

Asked whether Labour would cut spending in power, Reeves said: “At the moment, the Government have not set out their plans by individual departments, so we haven’t got a spending review. I will do a spending review quickly when I, if we win the election. But that’s not something that’s possible to do from opposition.

“But I do know that public services need more money, that’s why we will make that initial injection. But remember also the Office for Budget Responsibility’s forecasts are based on the Government’s plans.

“And the Government’s plans do not include our comprehensive plan to grow the economy. Our national wealth fund is about bringing in private sector investment, that’ll mean more taxes paid, that will mean more money for public services.”

The National: Sunday With Laura Kuenssberg

Kuenssberg (above) challenged the shadow chancellor to set out the differences between Labour and the Tories’ economic policy.  

“There’s two clear differences,” said Reeves.

“The first is the initial injection of cash into our public services by closing those tax loopholes and having a proper windfall tax on the energy companies.”

The BBC presenter said the sums these are predicted to generate were “crumbs” – and would not cover the amounts needed to significantly improve services.

READ MORE: Tories plot fresh crackdown on benefit claimants to fund tax cuts

Reeves replied: “They’re not crumbs – £1.5 billion for the VAT and business rates on private schools, £7.7bn over the course of the parliament by closing the loopholes et cetera.

“Those are not crumbs to go into our public services that the Conservatives aren’t investing. But second, in the end, you’ve got to grow the economy.”

She added: “We’ve got to get people back into work, ensure that they’ve got the skills to succeed and boost productivity and our plans are about doing exactly that.”

Labour have said their plans for a national wealth fund would bring in private investment to low-carbon projects would boost growth and increase tax revenue for the state.

The party has called in business chiefs and economists to advise on how to use its national wealth fund to leverage private investment.

READ MORE: Keir Starmer warned Labour must not be 'midwives of austerity 2.0'

Former Bank of England governor Mark Carney (below), Aviva chief executive Amanda Blanc and Barclays boss CS Venkatakrishnan are on the taskforce.

The National:

Labour has pledged to invest £7.3bn in the fund to support the growth of a zero-carbon economy, with each £1 of public money required to bring in £3 of private sector investment.

Reacting to the interview, Green MP Caroline Lucas (below) said: “Just dire that Rachel Reeves still refuses to invest in the green economy – public investment crowds in private investment and cuts fuel bills.

The National:

“Instead of locking themselves into arbitrary fiscal rules, Labour should be honest that borrowing to invest is sound economics.”

Both Labour and the Conservatives were last week accused of complicity in a “conspiracy of silence” over how public services would be funded.

The Institute for Fiscal Studies also warned that the Chancellor’s commitment to raise public expenditure by 1% would result in spending cuts in all areas other than the health service and a handful of other protected departments.