Chancellor John Healey will use his first major speech in the role to argue that Britain must back "wealth creation" and spread prosperity across all regions, as he attempts to reassure jittery financial markets over Labour's economic stewardship. Speaking in the Midlands ahead of what is expected to be a difficult Budget in October, he will insist that fiscal credibility is "indivisible" from growth and champion a shift of power towards city regions and local leaders, echoing an approach set out by new Prime Minister Andy Burnham.

The speech comes after UK government borrowing costs hit their highest level since the 2008 financial crisis last week, and follows Burnham's failure to rule out tax rises in the autumn Budget. Ahead of the address, ministers announced plans to cut business reporting red tape, saving firms more than £450 million a year, alongside £150 million from the British Business Bank to support fast-growing firms in the north. Opposition figures were sharply critical: shadow chancellor Andrew Griffith dismissed the speech as a "policy-light word salad", while Reform's Robert Jenrick called Healey "an empty vessel" and predicted taxes on working people would inevitably rise.