Tom Gordon

Scottish Political Editor

SHADOW Chancellor John McDonnell yesterday said Labour would back a controversial Tory policy as the party tries to rebuild its battered reputation for economic competence.

Just two weeks after Jeremy Corbyn was elected Labour leader on an anti-austerity ticket, McDonnell said the Opposition would support George Osborne’s fiscal charter, which is designed to eradicate the deficit and achieve a budget surplus by 2019-20.

It also commits future government to running a surplus in “normal times” thereafter.

Labour’s support for an earlier version of the charter was seized on by the SNP in the general election to claim Labour was backing an implied £30bn of cuts.

However in a newspaper interview on the eve of Labour Conference in Brighton, McDonnell said: “We are not deficit deniers. We will support the charter on the basis that we are going to want to balance the books, we do want to live within our means and we will tackle the deficit.

“But the dividing line between us and the Tories is how we tackle it. Our basic line is we are not allowing either middle or low-earners of those on benefit to have to pay for the crisis.”

Arriving for his first conference as leader yesterday, Corbyn claimed there was much to unite the party, despite the continued fallout from his victory.

After posing with selfies with a small group of supporters, he said: “Look at the unity out here, look at the hope people have got for a decent society where there is decent housing, decent education, a decent health service and hope for young people. That is what unites the party.”

However his day was ultimately overshadowed by a suggestive vegetable, as he posed for a series of bizarre photographs holding a large marrow on a visit to a garden centre.

The episode prompted comparisons with David Miliband’s ‘banana moment’, when the then Foreign Secretary posed awkwardly with a banana at Labour’s 2008 conference.

A Conservative spokesman dismissed McDonnell’s support for the fiscal charter saying Labour remained committed to higher borrowing.

"Nothing's changed. Labour are still saying they would run an overall budget deficit - that means they would carry on borrowing forever, risking higher mortgage rates."

SNP deputy leader Stewart Hosie said Labour were “still running scared of the Tories”.

He said: “The fact that Labour MPs will be mandated to troop through the lobbies with the Tories to back George Osborne’s plans will have people across Scotland scratching their heads – and questioning whether Labour has changed at all.

“The idea that they think the way to win back the trust of Scottish voters is to back George Osborne’s economic plans is sheer folly, and shows just how little they understand Scotland.”

Green MP Caroline Lucas said McDonnell had “fallen into a trap that Osborne has set him”. She said it reinforced Osborne’s line that the deficit was “the number one priority and we have to put every other policy at risk to get the deficit down to a pretty arbitrary timetable”.