“They probably feel like they can’t quit even though they want to, because it would require so much additional funding,” he says.
Mr Hammond argued it was unlikely to reduce overall spending, saying: “It’s very difficult to think about how to actually cut it because we have an aging population.”
A government official said Mr. Hunt’s limit is to limit growth to 1% above the inflation rate, and “that’s keeping the size of the state in check.”
In theory, Labor may have more room to maneuver. A new government that gains power after 14 years in opposition will be able to claim that it does not feel bound by the decisions of its predecessor and has a mandate for a new approach.
But Keir Starmer’s party has so far approached the government’s fiscal plans out of caution and fear of scaring voters and financial markets with talk of increased borrowing and spending.
This time, Labor has focused on a few mainly symbolic measures, such as the compulsory collection of value-added tax on private schools, to ease tax increases, rather than fundraising on the scale of the Conservative Party’s freezing of income tax thresholds. I promised to do it.
Mr. Reeves set new borrowing rules to show restraint.
“I have laid down Labour’s fiscal rules, which are firstly that we don’t borrow money to meet our day-to-day expenses,” she says.
“Secondly, reduce debt as a share of GDP, and thirdly, subject to the first rule being met, recognize that lack of growth is the main driver of high taxes and increased debt, and reduce potential growth Invest in power. This is what this tells us.”Government. “
Not many details are given about the Shadow Chancellor. And at least two more financial reports are expected to be released before the election. So I’m not going to give you a number on that, but I’m going to put it out closer to the election,” she says.
But the promised priority is growth.
“For the past 13 years, we have not been able to grow our economy. As a result, we have had to borrow more and pay more taxes to fund public services,” she says.
Without fiscal space, it will be difficult to revitalize the government and promote growth.
Stephen Timms, who was Chancellor of the Exchequer for much of the Labor era, said the Blair government initially felt unable to make major fiscal decisions, and while it avoided big spending, it appealed to voters that the situation had changed. He says it was necessary to find a policy that would demonstrate this.
“Tony Blair has succeeded in convincing people that this is different from what came before,” he says.
“Dramatic personnel changes, if people vote yes, will make the changes they would have wanted a reality. The personalities are different, and the way they talk about things is different.”
Fostering growth is certainly important. But it’s also easier said than done.