Starmer, whose Labour Party won a landslide election victory in July, has vowed to rebuild the fabric of British society, saying this month's anti-migrant riots reflected divisions that have taken hold, stoked by the Conservatives' preference for populism over problem solving.
But he used a speech in the Rose Garden of his Downing Street office to warn that any change would take time.
"There is a budget coming in October and it's going to be painful. We have no other choice given the situation that we are in," he said.
Starmer said he was willing to take unpopular decisions, including saying those with the broadest shoulders should be expected to carry the heaviest burden in the October 30 budget - short-term pain for long-term good.
"We have inherited not just an economic black hole but a societal black hole and that is why we have to take action and do things differently. Part of that is being honest with people about the choices we face and how tough this will be," he said.
"Frankly, things will get worse before we get better."
Britain's economy has endured sluggish growth, which is only now showing signs of improvement. (EPA PHOTO)
Addressing an audience of people he met during this year's election campaign such as apprentices, teachers, nurses and small business owners, Starmer said he was determined to rebuild trust in government and fix the foundations of the UK.
The Rose Garden last made headlines in Britain after it was used by former prime minister Boris Johnson and his staff to hold parties during COVID lockdowns, events that Starmer said had shattered the trust between the public and its politicians.
Starmer said the Conservative government's failure to tackle problems, and its focus on the "snake oil" of populism, had widened cracks in society, divisions that would take time to heal.
Starmer has repeatedly blamed the former Conservative government for leaving Britain in a parlous state.
He inherited an economy with sluggish growth, which is only now showing signs of improvement. Public sector net debt is at the highest since the early 1960s and the tax burden is on track to hit a near-80 year high.
Finance minister Rachel Reeves has said the public finances are on course to show a STG22 billion ($A43 billion) overspend, prompting her to cut billions of pounds worth of spending.
The Conservatives have dismissed the criticism as a pretext for Labour to raise taxes.
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