Via the Autumn Statement, page 25, forecast Government receipts and expenditure through the Parliament as a percentage of GDP:
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See also this chart, showing how our national debt is forecast to increase as a consequence.
The legacy this Government was handed remains a scandal.
Via HM Treasury, where all the key information may be found:
Responding to the Office of Budget Responsibility’s (OBR) updated Economic and Fiscal Outlook, the Chancellor has set out details of further action the Government will take to protect the UK from global instability and the euro area crisis and build a stronger, more balanced economy for the future.
Via Andrew Lilico on ConservativeHome:
When we criticise Osborne – and I do – we must not forget either the huge task he faces, nor the political constraints under which he operates, nor the remarkable scale of the plan he actually has.
Via John Redwood’s Diary:
There is a small shift from current to capital spending within the same increases in total spending. Over the five years capital spending will increase by a total of £5.8 billion. Current spending will be £1.1 billion less than the old plans in 2014-15. Total spending rises from £669.7bn in 2009-10 to £736.4 billion by 2014-15, an increase of 10% in cash terms.
I’m still reading…
Via National Statistics Online – Public Sector Finances, the trajectory of cumulative public borrowing this year more or less matches last year:
See also Deficit plan under pressure as UK borrows £14bn more in June.
Here’s the tragedy: while my constituents and people across the country are seeing real reductions in services and worrying about cuts to public spending, public sector borrowing in June was slightly worse than last year and Government expenditure will increase in cash terms every year of the next five.
In that context, press coverage of our dreadful financial position is woeful.
The state continues to live beyond its means, even as this Government wrestles to bring spending under control. Our public debt is increasing. The Bank of England continues to hold down the headline rate of interest. Inflation is too high, with all the injustice that entails for savers and those on low or fixed incomes.
Prosperity does not follow from borrowing to fund present consumption: it comes from consuming less than is produced, saving the excess and investing in capital goods, real productive capacity. If we are serious about prosperity for everyone in this country, journalists must raise the quality of public debate and Government spending must be reined in with the consent of the population.
That is the task facing the press today: not to promote denial or despair, but to encourage real understanding of the scale of the challenge we face.
Steve Baker (Wycombe) (Con): When I came to the House today, I expected to hear a great deal of Keynesian argument and I have not been disappointed. I am sorry that the hon. Member for Great Grimsby (Austin Mitchell) is no longer in the Chamber, as I wanted to congratulate him on his comprehensive grasp of Keynesian arguments. Unfortunately, it was also excruciating.
I am told that Keynes thought that the safe upper limit for the size of the state was 25% of national income. He might have halved the size of Government, so we can applaud the Budget as extremely moderate and thoughtful.
I have to tell those who propose deficit spending that it is inherently unsustainable. When Governments spend with a deficit they are bound to inject funds in a particular location in the economy and that is bound to create a pattern of economic activity that can be sustained only with deficit spending. We all accept that deficit spending cannot go on for ever. As one of my hon. Friends explained earlier this week, last year we were able to borrow only because we created a hole in the market for bonds using quantitative easing. That is so dangerous. In the past the world has seen the effects of printing money to pay off Government deficits, and I would dread to think that this country should live through such a circumstance.
I am reminded of some words published in 1945:
“I see now more clearly than ever before that even our greatest troubles spring from something that is as admirable and sound as it is dangerous-from our impatience to better the lot of our fellows.”
That is a quotation from Karl Popper, who is an interesting philosopher because, like his contemporary, Friedrich Hayek, he was a socialist until he understood where that philosophy went.
I am interested in the general well-being, particularly as Wycombe has not only great wealth but significant poverty and income levels everywhere in between. We must take seriously the realities that we face. I am glad that the Budget has included an announcement that there will be a review of pensions, and I should like to speak on that. I am grateful to my hon. Friend the Member for Stourbridge (Margot James) for having brought up the subject.
Read the rest of the speech here.
