The ONS said the slowdown was broad-based and economists and business groups placed the blame squarely on Starmer and Reeves.
“Uncertainty ahead of the Budget probably played a big part, with firms widely reporting a slowdown in decision making,” says Ben Jones, lead economist at the Confederation of British Industry (CBI).
“The Budget has set off warning lights for business.”
Lindsay James, investment strategist at money manager Quilter, says of the slowdown: “Much of this will have been as a result of the gloomy messaging that was persistent in the run-up to the Budget, causing consumers and businesses to pause spending and await what pain was to come.”
Both Starmer and Reeves began talking down public finances and warning of major tax rises almost immediately after winning power, casting a pall over the country.
Less than a month after coming to power, Reeves warned of a £22bn black hole in the public finances and immediately scrapped winter fuel payments for 10m pensioners.
Shortly after that, Starmer warned that the October Budget would be “painful”.
In the months leading up to the Budget, key Labour figures including Ms Reeves made repeated warnings that tax rises would be necessary.
David Bharier, head of research at the British Chambers of Commerce (BCC), said business confidence slumped “amid a spike in anxiety over tax and employment policy”.
On top of the Budget, Angela Rayner, the Deputy Prime Minister, also pushed forward her plans to radically increase the power of unions and workers, despite warnings from chief executives about the consequences.
Businesses will have to shoulder costs of up to £4.5bn in order to comply, according to the Government’s own impact assessment.
On a monthly basis, the economy shrank by 0.1pc in September, the first monthly contraction since April. Luke Bartholomew, deputy chief economist at abrdn, said the slump was almost certainly because of the Budget.