Labour’s Rachel Reeves has warned the “damage has been done” despite the Government’s “humiliating U-turns”.

The shadow chancellor called on the Government to “extend a windfall tax on energy producers” adding that Prime Minister Liz Truss has “no authority, no credibility, no plan for growth”.

Ms Reeves cautioned “every single public service is again at risk from the Conservatives” as she warned of “austerity season two”.

Addressing Chancellor Jeremy Hunt in the Commons, she said: “The fourth in four months of chaos and fiasco as this Conservative Government spirals down the political plughole. But the damage has been done.

“This is a Tory crisis made in Downing Street but ordinary working people are paying the price.

“All that is left after these humiliating U-turns are higher mortgages for working people and higher bonuses for bankers. And their climb-down on energy support begs the question yet again – why won’t they extend a windfall tax on energy producers to help foot the bill?”

Ms Reeves added: “It is clear for all to see: the people who caused the chaos cannot be the people to fix the chaos. They are out of ideas, out of touch and out of time.”

Ms Reeves said the Prime Minister should have addressed MPs, adding: “But we know she could not do that with a shred of credibility given that the survival of this Government depends on smashing to smithereens everything she stands for, and now she is attempting to reverse everything she campaigned for, it’s not just impossible, it is absurd.

“The Prime Minister is barely in office, and she is certainly not in power. Only five days ago she said at Prime Minister’s Questions there would be ‘absolutely’ no public spending reductions.

“But after what we heard from the Chancellor today, every single public service is again at risk from the Conservatives, from our NHS nurses to our schools and to our servicemen and women, with the country paying the price for their incompetence.”

She said of Mr Hunt: “The latest office holder has been in Cabinet for nine of the last 12 years, at the centre of a government responsible for low growth and weakened public services, and him responsible for helping run the NHS into the ground; he was a big part of austerity season one and now he says the cure is austerity season two.”

Responding, Mr Hunt said: “I don’t think she disagreed with a single one of the decisions that I announced to Parliament and that is important for the country and markets to know. And I think there is also agreement on the process of policy making.”

“I fully accept, and I don’t think that I could have been more clear that we have had to change some decisions made in the last few weeks, but what I reject wholeheartedly is her broader narrative about Conservative economic management.”

After defending the Government’s economic record since 2010, Mr Hunt added: “I’ve shown Conservatives can raise taxes, will she show Labour is willing to restrain spending?”

SNP Treasury spokesperson Alison Thewliss said a “cliff edge” is now looming in April when the energy price guarantee ends.

She told the Commons that “economic chaos” was an “understatement” for the situation, and added: “I’m not sure words have yet been invented to describe the scale of unmitigated disaster which the Prime Minister and her chancellors have created in the past 24 days.

“We are back where we started, significantly worse off, due to Tory incompetence.”

Mr Hunt accepted there had been “economic turmoil” over the last few weeks, as he said Scottish independence would be a “recipe” for austerity.

The Chancellor said he is “not against the principle” of windfall taxes, after calls from the Liberal Democrats to increase the levy on oil and gas profits.

Lib Dem leader Sir Ed Davey asked: “After so many U-turns, surely the Chancellor can persuade the Prime Minister do to one more?

“Will he introduce a proper windfall tax and help struggling families?”

Mr Hunt replied: “Let me tell him – I am not against the principle of taxing profits that are genuine windfalls.

“But as he will know very well in the energy industry, it is a very cyclical industry and there are businesses that have periods of feast and famine and you have to be very careful that you don’t tax companies in a way that drives away investment.

“We have said that nothing is off the table.”