05/07/2017 13:00 BST | Updated 05/07/2017 14:36 BST

Jeremy Corbyn Accuses Theresa May Of 'Flip Flopping And Floundering' On Public Sector Pay Cap

Prime minister says Labour wants to 'bankrupt' the economy.

Jeremy Corbyn has accused Theresa May “flip flopping and floundering” on whether to scrap the 1% public sector pay cap.

Speaking during prime minister’s questions, the Labour leader attacked May for agreeing to spend £1bn extra on Northern Ireland in order to convince the DUP to back her minority government.

“The prime minister found £1bn to keep her own job, why can’t she find the same amount of money to keep nurses and teachers in their job, who after all serve all of us,” he said.

In response, Theresa May mounted perhaps her strongest ever defence of Conservative austerity policies.

Senior Tory ministers including Boris Johnson have let it be known they think the 1% pay cap on some public sector workers should be lifted.

But the prime minister told the Commons the country needed to “live within our means”.

“It isn’t fair to refuse to take tough decisions and to land debts on our children and grandchildren. It isn’t fair to bankrupt our economy, because that leads to people losing their jobs and losing their homes,” she said.

“It isn’t fair to go out and tell people they can have all the public spending they want without paying for it,” she said to jeers from Labour MPs.

This morning transport secretary Chris Grayling acknowledged there was a “debate” among senior members of the government about the approach to the pay cap.

David Cameron returned to the fray yesterday with a defence of the public sector cuts begun under his leadership in 2010.

The former prime minister said Conservative critics of austerity were “selfish” as they wanted to be “spending money today that you may need tomorrow”.

His comments sparked an immediate backlash. John McDonnell told HuffPost UK: “Time and time again the Tories demonstrate they live in a different world from the rest of us.”

The shadow chancellor told the Commons this afternoon following PMQs that ministers were “scrapping in the school playground” over whether or not to keep the pay cap.