As many people know I have always argued for a sensible approach to public finances, and at both the County and Borough Councils I have always put forward costed budget alternatives based on imaginative but prudent financial planning as well as calling for a more commercial and sensible approach to both raising money and deciding how it is spent.
The continued overspends and ongoing financial position at the County Council has long been of great concern to me, and I have often argued that this is partly of the Council’s own making because of their reluctance to think more imaginatively.
Going into a national election therefore it has been with great interest that I, like a lot of members of the public, have spent some time looking at the plans of any future Labour Government.
The current Conservative Government have tripled the national debt and borrowed more money than any other British Government in history, and these needs to be addressed. I am not against borrowing money but only if there is a prudent business case to do so.
Borrowing for day-to-day expenditure can be done in the short term but it is not sustainable and the current Government’s record in doing this has become a real concern.
Labour’s Fiscal Credibility Rule then is exactly the sort of thing I was hoping to see in the manifesto. Designed with the help of economists it is based on the principle that the Government should not be borrowing for day-to-day revenue spending while acknowledging that borrowing to actually invest in the economy, with a view to generate a return through economic growth, is not only sensible but is a good thing to do.
The previous Chancellor’s reluctance to do this in the early part of his office, coupled with the massive cuts in public spending he oversaw, effectively put a stranglehold on the economy and put a squeeze on growth which in turn created a need for further revenue spending (welfare payments for the unemployed for example) which in turn contributed to the huge public debt we currently have.
Labour is committed to reduce the level of national debt is lower at the end of the next Parliament than it is today which in turn also frees up money for day to day expenditure because of lower interest payments.
But for me one of the most exiting plans Labour have is to strengthen a truly independent Office for Budget Responsibility. This will be made accountable to Parliament as a whole. As far as I am concerned, the Office for Budget Responsibility was set up with this role in mind, but for the last few years I’ve heard politicians from all sides simply quote their figures for their own political advantage. Giving this independent body a greater say would put sensible checks on Government spending and allowing parliament as a whole to oversee their work gives even further oversight.
Labour needs the economy to work and to use public finances to help kick start economic growth while keeping a watchful eye on borrowing for revenue, along with allowing more parliamentary debate and a greater independent roll for the Office for Budget Responsibility. This has to be a good thing and I welcome these plans.