Rishi Sunak has defended his boast that he diverted money away from "deprived urban areas" to funnel into other parts of the country.
The under-fire Chancellor did not withdraw the remarks he made to party members in Tory Tunbridge Wells last month, which were branded "scandalous" by Labour.
Mr Sunak doubled down instead, telling a hustings tonight: "I want to level up everywhere".
In leaked footage, obtained by the New Statesman, he said: "I managed to start changing the funding formulas, to make sure areas like this are getting the funding they deserve because we inherited a bunch of formulas from Labour that shoved all the funding into deprived urban areas and that needed to be undone.
"I started the work of undoing that.”
The video drew accusations that public cash was being funnelled into wealthy areas - which Mr Sunak's team denied, saying he was attempting to address the balance between urban and rural support.
Tunbridge Wells is a prosperous town that has been Conservative since the modern constituency was created in 1974.
After the video was widely shared, Labour deputy leader Angela Rayner branded the candidate "Reverse Robin Hood Rishi".
Shadow Levelling Up Secretary Lisa Nandy also wrote to her Tory counterpart, Greg Clark, demanding an investigation.
Speaking at a leadership hustings in Eastbourne tonight, Mr Sunak said: "I want to level up everywhere.
"As you may have seen from a video clip that was online, I don't believe that's just about our very large urban cities.
"I believe it's about investing and levelling up in small towns, in rural communities, in coastal communities like those here in the south east."
Earlier, he told Sky News that he was making the point that "deprivation exists right across our country".
He said: "That's why we need to make sure our funding formulas recognise that.
"People who need help and extra investment aren't just limited to big urban areas. You find them in towns across the United Kingdom and in rural areas, too.
"And that was the point I was making, that our funding formulas that fail to recognise that are out of date, and they needed changing."
At the hustings, Mr Sunak blasted his rival's tax cut plans, which he fears will fuel inflation.
He warned the party had “no hope” of winning the next general election unless it curbed runaway price hikes.
He said: “If we don’t get a grip of this thing and get a grip of it fast then we can kiss goodbye to winning that election.”
Mr Sunak also took a swipe at Ms Truss' plans to scrap corporation tax hikes.
He said: "We have had this debate on corporation tax. I don't want to stick with the failed policies of the past. That's what some people are suggesting. It hasn't worked.
