Oral Answers to Questions

Debate between Greg Hands and Rishi Sunak

Tuesday 21st July 2015 Commons Chamber

[Rishi Sunak (Richmond (Yorks)) (Con)]

10. What progress he has made on his deficit reduction plans.

[The Chief Secretary to the Treasury (Greg Hands)]

Since 2010, the Government’s long-term economic plan has halved the deficit as a share of GDP, but the job is not yet done. At 4.9%, the deficit remains too high. The summer Budget set out the action that the Government will take to eliminate the deficit and run an overall surplus and start paying down debt. The Government will reduce the deficit at the same rate as over the last Parliament, to reach an overall surplus of £10 billion in 2019-20, according to the forecast from the Office for Budget Responsibility.

[Rishi Sunak]

Future Governments need flexibility to respond to economic shocks. Does my right hon. Friend agree with me that the Charter for Budget Responsibility and plans to run a fiscal surplus are sensible measures that will provide that flexibility?

[Greg Hands]

I thank my hon. Friend for that question and he is absolutely right. The reliable way to reduce debt effectively over time is to run a surplus in normal time. Public sector net debt as a share of GDP reached 80.8% last year and the Government are committed to getting debt falling as a share of GDP from here on.