Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what (a) metrics and (b) fiscal multipliers she plans to use to take allocation decisions for capital spending to Departments in the next five years.

Economic growth is the number one mission of the government. Through the growth mission, the government will deliver a milestone of higher living standards in every part of the United Kingdom by the end of the Parliament.

Investment is a vital part of addressing the growth challenge. Autumn Budget began rebuilding Britain by increasing public investment and unlocking private investment. Public sector net investment will average 2.6% of GDP over the Parliament, with over £100 billion of additional capital investment over the next five years. This will strengthen the UK economy over the long term.

When making allocation decisions, the Treasury scrutinises individual capital spending proposals in line with the principles set out in the Green Book and Five Case Model, to ensure that they deliver value for money. It also considers these in line with the government’s wider priorities, such as growth, and their overall deliverability and affordability.

The independent Office for Budget Responsibility produces regular and comprehensive forecasts on the impact of current government policies, including judgements about fiscal multipliers.

The OBR confirms that the Budget will have a positive impact on GDP in the next parliament and into the longer term from additional public investment. If sustained, the OBR judges the higher public capital spending, and the higher private sector investment this incentivises, could increase potential output by 0.4% after 10 years, and 1.4% in the long run.