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.
33 Responses to “Former Cabinet Sec: Britain never on “brink of bankruptcy””
scandalousbill
It seems to me that the CSR provides the basis for the UK positioning of the American style neo-con ideology. Whereas the US tax breaks for the rich, dating back to Reagan and Characteristic of the bush years are replicated by Gideon’s recent tax holiday agreement with the Swiss, the Vodafone exemption settlement, the regressive VAT rise and the minimalistic bank levy of 2.5 billion.
The IMF is held out as justification for massive cuts impacting the social fabric of the UK, but ignored when setting the levy on UK banks. The Britian on the brink comparisons with Greece and Spain, the Canadian eport oriented solution to growth have no sound basis for comparison to the UK. The cuts hit the most vulnerable the hardest while notions of growth are based upon the simple notion of replacing the role of a reduced state involvement with private enterprise. There is no plan, just an ideologically based wish list for areas of prosperity. Whether it is the quick shock of double dip recession or the slow limbo of stagnation like the Japanese experience, the decline of the UK economy on the world stage has passed the brink and the slide is now underway.
Newbloke
RT @leftfootfwd: Former Cabinet Sec: Britain never on "brink of bankruptcy" http://bit.ly/be58r7
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