Government Debt

Baroness Kramer Excerpts

Tuesday 9th April 2019 Lords Chamber

[Lord Bates]

Certainly, the Government see merit in repaying debt; we pay interest rates of about £50 billion a year on debt, so there is a good rationale for trying to do that. However, we need to balance our approach. Primarily, we seek to stop that debt level increasing by bringing it down as a percentage of GDP from around 85% to 73% at the end of the forecast period, but we need to go further on that.

[Baroness Kramer (LD)]

My Lords, do the Government now understand that including borrowing for investment into infrastructure in the deficit number is not only intellectually flawed but has constrained growth in this country by limiting the number of projects in which we can invest, at a time when interest rates have been exceptionally low and a great deal more could have been done to catch up on the infrastructure backlog?

[Lord Bates]

I do not see how one can take it out of that figure. If it is public expenditure on infrastructure, it is government debt, so we need to reflect that in the numbers.