Budget Deficit

Lord Peston Excerpts

Wednesday 15th February 2012 Lords Chamber

[Lord Sassoon]

I completely agree with my noble friend. The point is that we will balance the books only because doing so over the five-year period is a prudent way of doing it. By that point the debt will also have started to come down. That is the way that the Government will continue to do it.

[Lord Peston]

The noble Lord told us all to be patient. I remind him that the great economist Lord Keynes said:

“In the long run we are all dead”.

Is the Government’s problem not that, having created this air of disaster for the country, no one in the private sector believes that the economy will get going and, therefore, no one has any intention whatever of investing in new equipment while the Government’s policies are in place?

[Lord Sassoon]

No, my Lords, I do not accept that at all. The only disaster is the mountain of debt—the structural position—left by the previous Government. As I have explained, the signs from the private sector, whether rising exports or rising total employment in the economy, are very encouraging. It is very difficult but we have to do everything we can, including keeping interest rates low, to make business confident enough to invest for the future.