Jeremy Corbyn’s spending plans would tank the economy and raise the deficit, experts say

LABOUR’S spending plans risk tanking the economy and sending government borrowing even higher, experts said today.

The Institute of Fiscal Studies blasted both main parties for failing to give voters an “honest set of choices” over tax and spending.

They blasted Labour’s proposals to hike spending by raising taxes on rich individuals and big businesses.

The thinktank predicted that Jeremy Corbyn’s party would fail to raise “anything like” the £50billion they want, leaving a black hole in their budget plans.

They also warned that the tax hikes would be “economically damaging” – and said that abolishing tuition fees could end up locking students out of cash-strapped universities.

The independent experts criticised parts of the Tory manifesto too, saying that Theresa May risked damaging the economy by being overly strict on immigration.

The IFS announced its analysis of the two main parties’ manifestos this morning, a week after the plans were officially unveiled.

Deputy director Carl Emmerson said: “The shame of the two big parties’ manifestos is that neither sets out an honest set of choices.

“For Labour we can have pretty much everything – free higher education, free childcare, more spending on pay, health, infrastructure.

“And the pretence is that can all be funded by faceless corporations and ‘the rich’.”

He pointed out that higher corporation taxes would lead to lower wages for workers and price hikes for consumers, as well as reducing the value of pension funds.

Rubbishing Labour’s claim that they can fund their spending plans by taxes on the wealthy, Mr Emmerson said: “There is no way that the tens of billions of pounds of tax rises they promise would be borne entirely by such a small group.”

The IFS said that Labour’s proposals would result in tax levels never before seen outside wartime.

The swingeing new levies could be “economically damaging” by sucking money out of the private sector, the thinktank concluded.

The analysts also took aim at specific Labour policies, such as the party’s promise to abolish university tuition fees.

The IFS said the policy was “the most expensive pledge in the Labour manifesto” even though it mostly benefits successful graduates from a prosperous background.

They predicted it would lead to universities having to offer fewer places because it would be impossible to fund the same number as today.

On the Tory manifesto, the IFS expressed concerns that lower immigration could reduce tax receipts by as much as £6billion.

They also criticised the party’s controversial plans for care of the elderly, saying: “Their proposals on social care have been in, shall we say, flux.”

And they expressed concern that measures such as means-testing winter fuel allowance would end up being “wholly trivial” in relation to public spending as a whole.

Mr Emmerson said: “For the Conservatives the big risk is that, after seven years of austerity, they would not be able to deliver the promised spending cuts either at all or at least without serious damage to the quality of public services.”

David Gauke, the Chief Secretary to the Treasury, said today: “Taxes would rise to their highest ever peacetime level if Jeremy Corbyn gets into Downing Street.

“Ordinary working families will be the ones who pay the price – not the top 5 per cent as he claims. His plans will increase the cost of living and hit wages.”

But Shadow Chancellor John McDonnell said: “What has become clear today is the choice at this election – continued austerity and falling living standards under the Tories, or higher wages and increased investment in our public services and infrastructure under Labour.”

Today sees the relaunch of the parties’ election campaigns after a three-day pause in the wake of the Manchester terror attack.

Mr Corbyn is giving a speech on security policy, while Mrs May is in Sicily for a meeting of G7 leaders.