Balanced Budget Rule — [Graham Stringer in the Chair]

Part of the debate – in Westminster Hall at 4:03 pm on 23rd January 2019.

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Photo of Peter Dowd Peter Dowd Shadow Chief Secretary to the Treasury 4:03 pm, 23rd January 2019

The hon. Gentleman is spot on. I do not want to misquote the Secretary of State for Transport, but when East Coast went bottoms up he said that that just proved that the market works. That is the sort of economic approach that the Tories take to our country.

Let me go through the three criteria one by one. We are a party that, first, takes seriously the mantle of being guardians of a sustainable economy. We fully costed our election promises in our grey book, “Funding Britain’s Future”. The Conservative party, by contrast, gave no costings whatever in its manifesto. As the shadow Chancellor said, the only numbers in the Conservative party manifesto were the page numbers.

Meanwhile, Carl Emmerson of the Institute for Fiscal Studies said in his election briefing that Labour’s

“forward-looking target for current budget has much to commend it”.

The IFS also estimated that we would have met our deficit target with £21 billion to spare, and that we would meet our debt target.

Secondly, we recognise that Government spending is not something to be scared of, or to have a phobia about, and that some economic metrics do not fully capture the benefits of the gradual build-up of public assets, as Stewart Hosie mentioned. That is why we distinguish between day-to-day spend and investment in our fiscal credibility rule, because investment is a different kind of Government activity that contributes to a stock of public assets, providing benefits over time. A country is not a house, or an individual who has a lifetime; it goes on, as we know, for a long time. Comparing us to a household might be a soundbite, but it is economic fantasy.