Keir Starmer will give a speech in the West Midlands later today where he will say “better days are ahead” if the country adopts a long-term plan to boost investment and rebuild public services.

He is expected to say: “It is working people who pay the price when their government fails to deliver economic stability.

“They’ve had enough of slow growth, stagnant living standards and crumbling public services. They know that austerity is no solution. And they’ve seen the chaos when politicians let borrowing get out of control.”

The Prime Minister’s speech is a further attempt to lay the ground ahead of Chancellor Rachel Reeves’ delivery of Labour’s first Budget in 14 years.

Starmer will add: “Politics is always a choice. It’s time to choose a clear path, and embrace the harsh light of fiscal reality so we can come together behind a credible, long-term plan.

“It’s time we ran towards the tough decisions, because ignoring them set us on the path of decline.”

Reeves has said she has to fill a £22bn black hole left by the previous Conservative administration this year, but just doing this would only be enough “to keep public services standing still”.

She is understood to be drawing up plans to find to up £40bn of levies and savings in the Budget to avoid real-term cuts to departments.

The Chancellor has also drawn up changes to the country’s debt rules that will allow the government to spend up to £50bn extra on infrastructure projects, which she expected to detail on Wednesday.

Labour has pledged not to raise revenue from income tax, employees’ national insurance contributions, VAT and corporation tax.

Last week, a note from Goldman Sachs to clients said it expects the government to lift rates in four areas — capital gains and inheritance tax, removing the national insurance exemption on employer pension contributions, and extending the freeze on personal income tax thresholds.

The government has said it will not raise tax rates on working people.

However, last week Starmer attracted criticism when he suggested that those who earn in come from assets, such as landlords, are not working people.

The Prime Minister said his definition of a working person was somebody who “goes out and earns their living, usually paid in a sort of monthly cheque” but they did not have the ability to “write a cheque to get out of difficulties”.

But the National Residential Landlords Association Ben Beadle said: “It is simply not true that landlords are not working people.

“Official data shows that 30% of landlords are employed full-time, with a further 10% working part-time.

“28% are self-employed in some way, while 35% are retired and are likely to rely on their rental income for their pension.

“Rather than stoking misconceptions, the government needs to focus instead on the key challenge in the rental market, namely a lack of homes to rent to meet ever-growing demand.”