Government Debt

Lord Hunt of Wirral Excerpts

Tuesday 9th April 2019 Lords Chamber

Asked by

[Lord Hunt of Wirral]

To ask Her Majesty’s Government what plans they have to ensure that the level of government debt falls.

[The Minister of State, Department for International Development (Lord Bates) (Con)]

My Lords, as a result of the Government’s balanced approach we have been able to reduce debt while supporting public services, investing in the economy and infrastructure, and keeping taxes low. Debt peaked in 2016-17 at 85.1% of GDP and, due to the actions of this Government to reduce borrowing and support to the economy, debt fell in 2017-18. It is forecast to fall further, all the way up to the end of the forecast period in 2023-24.

[Lord Hunt of Wirral (Con)]

What action are Her Majesty’s Government taking to ensure a balanced approach to managing the public finances? Does my noble friend agree that it is vital that, while we prudently reduce both borrowing and debt, we invest in public services and keep taxes low for hard-working people?

[Lord Bates]

I am very happy to do that, and of course my noble friend will be aware that 32 million people have just enjoyed a tax cut as the tax thresholds were raised. There is a balance; we have seen net borrowing come down from a peak of about 10% in 2010 to under 2%, and overall net debt is beginning to fall after having peaked. However, at the same time, as he rightly says, we have seen half a trillion pounds of investment in infrastructure, and the prioritisation of public services, principally the National Health Service, which has had one of the largest budget increases in its history.