Fraser Nelson Fraser Nelson

Lucy Powell confirms: debt-addicted Labour has no plan to balance the books

‘You aren’t listening to what I’m saying,’ said a rather rattled Lucy Powell, Labour’s election chief, whom the party put up for BBC Sunday Politics today. I suspect that, by now, she’ll have wished that we weren’t listening. Because in a commendable moment of candour, she admitted that the Labour Party intends to keep debt rising should it win power – and has no real deficit reduction strategy.

Ms Powell dispensed with Ed Balls tricksy language and told it how it is. Here she is, talking to BBC Sunday Politics (11 mins in, after complaining about a ‘Paxo-style interview’).

‘Andrew Neil: You would borrow more, wouldn’t you?

Andrew Neil: To bridge the deficit you have to borrow more. You’re going to borrow £30 billion a year simply to pay for public investment. That’s part of what you’re going to do – correct?

Lucy Powell: We are going to balance the books by the current expenditure by end of the Parliament.

Andrew Neil: And borrow £30 billion  a year for public investment

Lucy Powell: We may we may use some investment borrowing for much-needed investment but not for day-to-day spending’

So Labour would not balance the books; the debt would rise ever-upwards. She was so annoyed at the beginning because she was asked what taxes Labour would introduce do to cut the deficit — and she started waffling about how Labour would magically increase people’s pay.

But she then went further than any other Labour figure in admitting that the 50p tax is the only one that would go towards deficit reduction (as opposed to funding extra spending projects). The killer quote is that the 50p tax is…

‘… the only tax that we have set out that will be increasing. But we are very clear that what we can do is increase the tax base.’

So Labour is wrong to boast about “fair tax rises” – Lucy Powell has just confirmed that it only proposes one tax rise.

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