Former Cabinet Sec: Britain never on “brink of bankruptcy”

Green Politics

A key premise of George Osborne's argument for rapid spending cuts has been questioned by former civil service boss, Lord Andrew Turnbull.

A key premise of George Osborne’s argument for rapid spending cuts has been questioned by former civil service boss, Lord Andrew Turnbull.

Responding to questions from Chuka Umunna MP, the former Cabinet Secretary said it he didn’t agree with Osborne’s claim that Britain had been on the “brink of bankruptcy” and that Britain was never at risk of a sovereign debt crisis.

Watch it:

UMUNNA: Do you think it’s accurate to describe the UK as being on the brink of bankruptcy?

TURNBULL: No I don’t. But I think it was essential, for a slightly different reason, to have a deficit reduction programme.

The Chancellor claimed in his spending review speech last week that Britain had been on the “brink of bankruptcy”. Lord Turnbull also poured water on fears expressed by Nick Clegg and Chris Huhne among others over a Greek-style sovereign debt default:

“I always thought that we were capable of producing a financial settlement that wouldn’t take us into Irish or Greek problems. Secondly, a very large part of our debt was domestically held. If people are going to sell gilts they’ve got to buy something else. Who are these great shining example of people who are issuing really rock solid debt that you want to buy?”

Lord Turnbull also said that Liam Fox’s letter to David Cameron was “written to be leaked“.

Gordon Brown, once described by Turnbull as running the Treasury with “Stalinist ruthlessness” was not spared by the former civil servant. Turnbull said Brown’s settlement letters in the 2000 and 2002 spending reviews were “arrogant and offensive” and that the Golden Rule had the effect of worsening boom and bust.

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33 Responses to “Former Cabinet Sec: Britain never on “brink of bankruptcy””

  1. william

    Note that Turnbull fairly and squarely blames Brown.We need to get him out of the Commons, now.Since Turnbull claims it was essential to have a deficit reduction programme, perhaps Brown and Darling will explain why they flunked a CSR when they were in office.This handed the iniative and the election to the tories.We will not be a credible opposition, let alone the next government,until we have dealt with the manifest failures of Brown, after 2001.Finally, Turnbull should note the attractions of holding Scandinavian and Australian debt, gilts are not the only game in town,but he may have missed the abolition of exchange control.

  2. Richard Blogger

    The point is very simple: the reasons given by this tawdry government for destroying out public services and welfare state are to “protect us” from:

    1) Bankruptcy
    2) A Greek-style financial crisis and
    3) Johnny Foreigner who they told us “owned all the national debt”.

    Turnbull says that all these things are utter nonsense. I bet you won’t see the BBC showing this.

  3. Shamik Das

    Gr8 q from @ChukaUmunna referring to the former Cabinet Sec's comments the UK was never on "brink of bankruptcy" (see http://bit.ly/cRYYM6)

  4. Dominic Smith

    RT @wdjstraw: Key premise of Osborne's #SR10 undermined by Ex-Cab Sec Lord Turnbull – Britain never on "brink of bankruptcy" http://bit.ly/cRYYM6

  5. Stuart Pearce

    RT @leftfootfwd: Former Cabinet Sec: Britain never on "brink of bankruptcy" http://bit.ly/be58r7

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