Monday, September 23, 2013
Labour's black hole
Whilst Ed Miliband and company seek to carve out a distinctive path for Labour in the run-up to the next General Election, a more substantial problem faces them, their sums just do not add up.
According to the Sunday Times the party has created a £27.9 billion “black hole” of unfunded promises to raise welfare spending in its first year of office if it wins the 2015 election.
A document released by Sajid Javid, economic secretary to the Treasury, calculates that to meet spending commitments made by Labour frontbenchers since June would require the equivalent of £1,059 additional borrowing for every household:
Treasury officials examined eight “proactive spending” commitments made by the party since June, including introducing a “jobs guarantee” of a paid position for all over-25s who have been unemployed for two years, restoring the child trust fund, scrapping the so-called bedroom tax, and introducing a 10p starting rate of tax. It also analyses Labour’s proposals to cancel eight spending cuts, including to legal aid, the Arts Council and police funding.
Finally, it analyses the effect of seven of Labour’s revenue-raising commitments, such as introducing a bank bonus tax and withdrawing the winter fuel allowance for wealthier pensioners.
The findings — released through freedom of information requests and answers to written parliamentary questions — suggest a £27.9bn shortfall.
This is going to be a problem for Labour right up to the moment they publish a fully costed manifesto, if they do at all. It is the curse of being in opposition but one made worse by the indiscipline shown by Labour spokespeople.
According to the Sunday Times the party has created a £27.9 billion “black hole” of unfunded promises to raise welfare spending in its first year of office if it wins the 2015 election.
A document released by Sajid Javid, economic secretary to the Treasury, calculates that to meet spending commitments made by Labour frontbenchers since June would require the equivalent of £1,059 additional borrowing for every household:
Treasury officials examined eight “proactive spending” commitments made by the party since June, including introducing a “jobs guarantee” of a paid position for all over-25s who have been unemployed for two years, restoring the child trust fund, scrapping the so-called bedroom tax, and introducing a 10p starting rate of tax. It also analyses Labour’s proposals to cancel eight spending cuts, including to legal aid, the Arts Council and police funding.
Finally, it analyses the effect of seven of Labour’s revenue-raising commitments, such as introducing a bank bonus tax and withdrawing the winter fuel allowance for wealthier pensioners.
The findings — released through freedom of information requests and answers to written parliamentary questions — suggest a £27.9bn shortfall.
This is going to be a problem for Labour right up to the moment they publish a fully costed manifesto, if they do at all. It is the curse of being in opposition but one made worse by the indiscipline shown by Labour spokespeople.
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I cannot resist the thought that they can promise anything, knowing they will not win the next election.
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