Corbyn warns that average wages will fall by £858 by 2022 due to Tory economic mismanagement

Workers will be earning £858 less per year by 2022 than expected as gloomy economic growth forecasts set out in the Budget hit pay packets, Jeremy Corbyn is set to claim.

In a speech to party faithful, the Labour leader will accuse the Government of presiding over a “completely broken” economy which will leave many ordinary workers worse off than before the financial crisis.

New analysis for the party found the average worker would be £2,257 worse off over the five-year-period after the Office for Budget Responsibility (OBR) slashed forecasts for earnings growth until 2021/22 in its analysis published as Philip Hammond delivered his Budget on Wednesday.

It comes after leading economic experts warned the UK was facing two “lost decades” without wage growth and a sustained fall in living standards following the Chancellor's statement on Wednesday.

Despite a £25bn giveaway for housebuilding, tech and the NHS, the Institute for Fiscal Studies said the Budget did not mark the end of the "age of austerity" as it pointed out that other public services outside the NHS will still face 7 per cent cuts in day-to-day spending over the next five years.

The respected thinktank also warned that low growth would hit hard as the UK faces the challenge of recovering from the financial crisis, deep austerity cuts, low productivity and the uncertainty of Brexit.

Speaking at Labour’s South West Regional Conference, Mr Corbyn will say: “Wednesday’s Budget was an alarming exposé of the Tories’ failure on the economy.

“Pay for most people is now lower than it was before the financial crash in 2008. The UK is the only major developed economy in which pay has fallen despite growth returning. Here in the South West, pay has fallen by an average of £1,500.

“It is frankly astonishing that anybody could have the cheek to claim we have a strong economy, when most people are losing and not gaining income.”

Pointing to Budget forecasts from the OBR - the Government's official auditor - Mr Corbyn will claim ordinary people would "bear the brunt of the Government's poor management of the economy" as the analysis found that average earnings would be £30,004 in five years rather than the expected £30,862.

He was due to say: "Despite all the evidence, the Tories refuse to accept that cutting public services, holding wages down and refusing to invest is a recipe for failure.

"The Government cannot continue to tinker at the edges of an economy that is so completely broken. Our country needs a new and very different approach."

If elected, Labour previously vowed to spend an extra £17bn per year on crisis-hit public services, with top demands including pausing the controversial Universal Credit rollout and scrapping the pay cap for all public sector workers.

In his speech, Mr Corbyn will also take aim at the Tories for trying to "use Brexit to run down our fishing and farming" and will call for the entire body of environmental EU law to be transferred to the statute books after Brexit.

He will say: "If we do not defend our farming standards and take radical steps to protect our environment then our whole rural way of life will be under threat."

The lack of support for new renewable energy projects in the Budget is "a move straight out of the Donald Trump environmental playbook at a time when we need be taking bold and decisive steps to end environmental destruction and stop rising sea levels", Mr Corbyn will add.