Rishi Sunak has defended his Spring Statement and stressed he 'can't solve every problem' after it emerged living standards will fall further this year than at any time since records began in 1956.

       The Chancellor yesterday unveiled a reduction of 1p on the basic income tax rate - due to come into force in 2024 - and raised thresholds at which people start paying National Insurance as he tried to address the cost of living crisis.

       But Mr Sunak immediately faced calls to go much further as official projections from the Office for Budget Responsibility showed families are facing a historic squeeze on the finances.

       Meanwhile, despite Mr Sunak's new tax cuts, the overall tax burden is on course to hit its highest level since the late 1940s.

       The Chancellor today attempted to deflect criticism of his statement, telling Sky News: ‘Whilst I can’t solve every problem, and I have always been honest with people about that, I can make a difference, of course that is what I want to do and I think the plan that we announced yesterday will do exactly that and support hard working British families.’

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       Rachel Reeves, the shadow chancellor, said Rishi Sunak claiming to be a tax-cutting chancellor is “like a kid in his bedroom playing air guitar – he’s not a rockstar”.

       The Labour MP told LBC Radio: “The Chancellor can say as many times as he likes that he’s a tax-cutting chancellor but it’s a bit like a kid in his bedroom playing air guitar – he’s not a rockstar.

       “The problem is for this Chancellor, is that by the end of this Parliament seven out of eight people will be paying more taxes – only one in eight will be paying less taxes.”

       She said there have been “15 Tory tax cuts” in just two years.

       The OBR has forecast inflation could rise to 8.7 per cent by the end of 2022.

       Rishi Sunak was asked this morning if there is anything the Government can do to cool spiking prices.

       He told the BBC: “Primary responsibility for inflation rests with the Bank of England and it is rightly independent and you will have heard from the Governor about their plans for interest rates and we have started to see those go up obviously.

       “On our side what is important is that we don’t make the situation much worse and obviously governments with their borrowing and spending, I have to be cognizant of that, that we don’t make inflation worse by our actions.”

       Analysis from the Resolution Foundation think tank suggested 1.3million Britons are set to fall below the poverty line next year as the cost of living crisis worsens.

       Mr Sunak was challenged on the figure during an interview with the BBC and was told that in a growing economy more people should actually be lifted out of poverty.

       The Chancellor said: “The track record of this Government and previous Conservative governments in tackling inequality and poverty is very strong.

       “If you look at the figures over the last 10 years there are about 1.3million fewer people living in poverty, half a million fewer children growing up in workless households, hundreds of thousands of fewer children in poverty.

       ‘“The primary reason for that is because we have been able to do a very good job of getting people into work and making sure that those jobs are well paid. That is the surest and best and most sustainable route to move people out of poverty.”

       The OBR's "economic and fiscal outlook" document, released alongside the Chancellor's Spring Statement, runs to 245 pages but two paragraphs stood out and have framed the way in which Rishi Sunak's plans have been received.

       The first is on falling living standards:

       The second is on the tax burden:

       It is these two issues which will be dominating discussions between Tory MPs this morning.

       Boris Johnson has suggested the UK could target Russian president Vladimir Putin’s gold reserves in response to the invasion of Ukraine.

       He told LBC: “We need to do more, and so we need to do more economically. Can we do more to stop him using his gold reserves, for instance, in addition to his cash reserves?

       “What can we do more to sanction Swift? And then we need to do more to give the Ukrainians military support."

       Away from the Spring Statement, the Prime Minister is in Brussels today for a NATO and G7 summit which will focus on Russia's invasion of Ukraine.

       Mr Johnson said this morning that he believes Vladimir Putin has already crossed a "red line" with his "barbarism".

       Speaking to LBC Radio ahead of the summit, he said: “We all want to see some solution in Ukraine. Everybody is hoping that Putin will pull back and stop this incredible barbaric slaughter that he’s engaged on.

       “But the only way to do that – we think there’s a huge amount of unity – is to keep going with the pressure that we’ve applied, and to increase it.

       “And the point I’m going to make today is look, you know, he’s already crossed a threshold of barbarism in the way he’s behaving. People talk about new red lines for chemical, biological, tactical nuclear weapons or whatever. For me, the red line already has been crossed.

       “He’s bombing indiscriminately civilian centres. He’s causing huge numbers of casualties in wholly innocent populations.”

       Rishi Sunak was told during his interview on Sky News that some people may believe he is not "really in touch with real people's lives".

       He replied: “This has been put to me many times and what I say is judge me by my actions and people can see how I have acted over the last couple of years as our country went through a very difficult period and I think I demonstrated that I am standing by British people when we go through difficult things.

       “I introduced things like furlough, I helped this country get through a pandemic. And partly because of the actions that I took the economy is in a much stronger place anyone expected now, with more people on payroll than we had before the pandemic, unemployment back down to the record low levels we saw before the crisis.

       “That doesn’t happen by accident, that happens because of the policies that we have put in place.”

       The Chancellor's first broadcast interview of the morning was on Sky News and he was immediately put under pressure over the rising tax burden.

       Asked if he accepted that the tax burden is rising despite his new tax cuts, Mr Sunak replied "yes" but then spoke at length about the "context" of the Spring Statement, namely that it comes after the coronavirus pandemic and amid rising economic uncertainty because of Russia's invasion of Ukraine.

       He said he believes the Spring Statement will help struggling families but admitted he "can't solve every problem".

       He said: "That’s the context for all the actions that I have had to take. But I know families are struggling right now with the cost of living which is why yesterday I announced a tax plan which delivers the biggest net cut in personal taxes in over a quarter of a century, cutting fuel duty five pence a litre, raising national Insurance thresholds, giving 30million workers a tax saving, a typical worker saving ￡330 and cutting income tax for the first time in 16 years, putting more money in people’s pockets.

       "So whilst I can’t solve every problem, and I have always been honest with people about that, I can make a difference, of course that is what I want to do and I think the plan that we announced yesterday will do exactly that and support hard working British families."

       Rishi Sunak has woken up to a brutal set of newspaper frontpages as his Spring Statement receives a rough ride across all sections of the media.

       The Telegraph splash has the headline "The biggest fall in living standards on record” and most of the other national press follows a similar theme.

       The Daily Express goes with "The forgotten millions say: What about us?” while The Daily Mail states: “Now slash taxes even further”.

       The i goes with "Biggest hit to living standards since age of rationing” and The Independent offers: “UK faces biggest fall in living standards on record”.

       The Mirror splash tells the Chancellor "Thanks for nothing” while The Sun goes with “Rishi tax gain but still pain”.

       Good morning and welcome to today's politics live blog.

       There is a busy morning ahead, starting with Rishi Sunak on the broadcast round to defend his Spring Statement.

       We will then get the formal verdict on Mr Sunak's plans from the Resolution Foundation and the Institute for Fiscal Studies.

       Meanwhile, Boris Johnson is in Brussels for a NATO and G7 summit.

       I'll guide you through the key lines.

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