Fiscal Rules

Debate between Lord Livermore and Lord Liddle

Tuesday 29th October 2024 Lords Chamber

[Lord Livermore (Lab)]

I am not aware that the Government have any such plans, but I hope that tomorrow’s Budget will include good news for Wales.

[Lord Liddle (Lab)]

My Lords, the new policy on investment that has been announced will be widely welcomed on this side of the House as giving an opportunity for the public sector, in partnership with the private sector, to raise the dismal rate of growth that we experienced under the last Government. Will my noble friend not let noble Lords opposite get away with the total unsustainability of their fiscal plan to cut public investment from 2.6% of GDP to 1.9%, which would have had disastrous consequences for growth and public services?

[Lord Livermore (Lab)]

I am extremely grateful to my noble friend for that point and for his support for what we have set out. He is absolutely right to draw attention to the record we inherited. As he says, the UK lags behind every other G7 country on business investment as a share of our economy, and the plans we inherited from the previous Government would have seen public sector investment decline to the lowest level in over 10 years. Nothing we have heard so far today suggests that they think there is anything wrong with that.

My noble friend also drew attention to the importance of partnership with the private sector. To rebuild our country, it is vital that we increase investment in partnership with the private sector. As he says, we must first create the conditions for the private sector to invest by stabilising our economy and introducing reforms to things such as planning and skills. The Government must invest alongside business, through expert bodies such as the new national wealth fund, to catalyse more private sector money. As we have been discussing today, there is also a significant role for public investment to play.