Labour will today force a vote on the cornerstone of Tory austerity by demanding Theresa May’s new government formally abandons George Osborne’s discredited fiscal rules.

John McDonnell will lead Labour MPs in forcing May’s new administration to rethink the former Chancellor’s “failed economic plan”, which is still in place even though the makeup of the cabinet has changed and the new PM has indicated a climbdown. Labour will use an Opposition day debate to call for a strategy to provide investment and growth in order to stabilise the economy.

The document which set out Osborne’s target for spending cuts – the Charter of Budget Responsibility – contains three measures: to decrease debt as a proportion of GDP, to cap welfare spending and to reach a budget surplus by 2019/2020. So far, the they have failed to reach the first two targets and, following the referendum result, George Osborne said the Government would have to abandon plans for achieving a surplus.

Until now, the Tories have said they will wait to see the impact of the Brexit vote on the economy before assessing the surplus target but McDonnell said families and businesses “cannot wait” to know the Government’s financial plans.

“The Tories want to pretend to the British people that just because they had a change of Chancellor that they have had a change of policy, but the truth is that George Osborne’s failed economic plan is carrying on under Philip Hammond.

“If this is not the case then he can join with Labour in voting against the planned cuts to investment spending and in-work benefits that his predecessor announced in the Budget built on failure back in March.

“Philip Hammond cannot keep saying he is waiting ’til the end of the year because the Government he was part of didn’t plan for the fallout of Brexit from a referendum that they called.

“Britain is being placed on hold by the Tories, as there are families and businesses around our country who are planning ahead now, who cannot wait for the Chancellor to finally make up his mind up.”

Labour has criticised the rules consistently, pointing out that public spending cuts threaten growth. McDonnell has called for an alternative strategy of “long-term, patient investment” instead to stimulate the economy and provide growth but previously faced criticism from MP colleagues after performing a u-turn over the fiscal charter, in October, which he described as “embarrassing”. The Labour leadership ultimately whipped MPs to vote against the charter but several chose to abstain.