Darling lays down the spending gauntlet - but will it be flung back in his face?
Peter Hoskin 10:46am
So here it is. After rumblings that Brown is prepared to set out spending cuts - rather than hiding them away in he small print of the Budget - Alastair Darling confirms the new strategy in an interview with the Times. He doesn't actually use the word "cuts", but it amounts to that:
"'As there is less uncertainty you can decide what your priorities are,' he said. 'This doesn’t mean you are going into some sort of Dark Age but we will have to decide, given what’s happened to the economy, how much we think we can afford to spend on services, how much we should be devoting to making sure we recover our fiscal position. That’s a judgment that I’m going to have to make at the Pre-Budget Report in the autumn.'...
He said: 'Once you start getting into recovery, then that is the time when you have to say "Now we need to start doing something about the deficit". When you look at the burden of where the deficit reduction comes from, it is tax, yes, but it is also having much tighter public spending.'"
Intriguingly, given the shape of the public spending battle before now, Darling even "challenges" the Tories to set out how they'd cut spending too. It's a slightly shameless demand, but one the Tories may have to meet: as Fraser's political column highlights this week, Darling isn't the only one who'd like to hear more about the Tories' debt reduction plans. Although, if we take David Cameron's recent interview with the Economist at face value, the Tories were planning to set out some fiscal "fine print" before the election, anyway.
For the time being, and City qualms aside, the Tories are in a much stronger political position than the government over this. You suspect that Brown's bluster about "Labour investment vs Tory cuts" may have fatally undermined his party's ability to be taken seriously on the public finances. And the very fact that it's his spending, spending, spending which got us into this mess hardly inspires confidence about his willingness to cut back.
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Sally Chatterjee
September 5th, 2009 11:01am Report this commentTo me, it shows more political weakness from Labour. They've had to be dragged into the honest premise that our public finances need some balance, they have been playing politics with the nation's accounts.
I still worry about an election launched on the back of a giveaway budget next year but one economist I know said that's impossible, since any "giveaways" risk provoking a currency crisis, the last thing Brown would want before he's ejected.
Boudicca
September 5th, 2009 11:02am Report this commentI wouldn't trust any Labour Government to cut the grass and do it competently - let alone cut public spending. As for the idea that the one-eyed Scottish Moron could and would do it - that is completely ridiculous. This is the man who spent every penny he raised in taxation during a boom and increased tax so he could spend even more at the same time as borrowing billions. He doesn't know HOW to cut spending.
All this really indicates (once again) is that power in the Government no longer lies with Gordon Brown - and there are powerful people in the party working towards getting rid of him before the election.
I think it will happen fairly soon after the Irish have voted on the LisbonConTreaty again.
barnacle bill
September 5th, 2009 11:07am Report this comment'Once you start getting into recovery, then that is the time when you have to say "Now we need to start doing something about the deficit"
It is a pity a former Chancellor did not bear this in mind when he got into No. 11
Irene
September 5th, 2009 11:31am Report this commentLet's see his Pre-Budget Report first - it is too early for the Tories to show their hand, knowing things can get pinched and dressed up by Labour.
I also think the Irish will vote NO.
david skitmore
September 5th, 2009 11:34am Report this commentLabour over twelve years have squandered over one trillion pounds given away billions more in foreign aid if Britian was a private business the auditors would not sign off the books. The national debt is breathtaking paying back the interest alone on these debts are mind blowing the problem for the next tory government is the massive public sectors a public sector that nolonger serves the public but are the masters not the servants the tories will needs to take a chainsaw to these unelected quangos if they fail to do so the tories will be in government but not in power.
Trumpeter Lanfried
September 5th, 2009 12:19pm Report this commentInteresting. Darling has whipped Brown into line.
oldtimer
September 5th, 2009 12:28pm Report this commentAll Darling is doing is trying, and failing, to make the case for more procrastination...quote: 'Once you start getting into recovery, then that is the time when you have to say "Now we need to start doing something about the deficit".
He should be doing something about the deficit right now, not waiting until the economy shows signs of bottoming out and resuming some modest growth. This irresponsible Micawber like approach is typical of politicians.
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