Charter for Budget Responsibility

Debate between Barry Gardiner and Ed Balls

Tuesday 13th January 2015 Commons Chamber

[Ed Balls]

It is either a three-year rolling five-year target to avoid ever getting to be judged on it, or it is because he could not get his quad partners to agree with it before the autumn statement. We know from the letter from the OBR that the quad signed up to the spending cuts, but perhaps the quad did not quite sign up to the fiscal charter the Chancellor wanted.

[Barry Gardiner (Brent North) (Lab)]

Does my right hon. Friend agree that perhaps the reason for the wording is that at any given point when the Chancellor is asked whether he has met the aim—not the target—he can say, “We are going to meet the aim because this is now the five-year rolling period and we aim to meet it in the third year”? But in no specific year will he actually be held to account for whether he has met it.

[Ed Balls]

Of course that is exactly what the Chancellor has done in this Parliament. In 2010, when he set his first mandate, he said that this would be done by the end of the rolling five-year forecast period. In 2010, the Prime Minister clearly thought that that meant 2015 but the Chancellor now thinks it means 2018 or 2019, which is why he still says he is meeting his fiscal target. Everybody else can see it is a completely preposterous claim.

The Economy

Debate between Barry Gardiner and Ed Balls

Wednesday 22nd June 2011 Commons Chamber

[Ed Balls]

No, no, no.

A year ago, we had a balanced plan: people paid their fair share, there were spending cuts and there were tax rises, but it was cautious and was not a pre-ordained political timetable or a headlong lunge. That is what the Chancellor should be doing now. He should be adopting a more sensible approach to deficit reduction, which would allow him temporarily to reverse the VAT change right now. He should also reopen the spending review and have a steady approach to spending cuts. A 20% cut in police budgets, front-loaded, is complete criminal justice madness. He should take up our plan to repeat the bank bonus tax, build houses and get young people back to work. As I have said, a temporary VAT cut now would put money into people’s pockets, boost confidence, push inflation down and give our flatlining economy the jump-start it urgently needs. That would be a better way of getting the deficit down.

[Barry Gardiner (Brent North) (Lab)]

My right hon. Friend will know that the UK taxpayer will still be contributing to any bail-out of Greece through the International Monetary Fund, but will he comment on the fact that if Greece does fail and subsequently other countries follow that failure into default, that could precipitate the end of the IMF? The loans that the UK taxpayer is making to the IMF would then never be repatriated.

[Ed Balls]

The IMF is there to help countries through situations like this. We are a shareholder and a contributor to the IMF and that is quite right. It is a different matter our putting liquidity money into a eurozone strategy that patently is not working because it is flawed. My argument to the Chancellor is that it is ironic to see a British Conservative Chancellor backing the German Finance Ministry’s view over sanity and common sense. We have not seen that in our country for a very long time.