Nick Clegg says there will be a “massive” increase in housing and infrastructure investment - yet the Treasury refuses to say where the money is coming from.
After posting this article, the Treasury was good enough to get back in contact with us and answer all our questions very helpfully. While Clegg is championing increased spending on infrastructure and housing, the government is yet to finalise how to achieve this policy.
It may be good PR to make speeches about growth and investment, but without a nailed-on plan on how to do it, the government gets all the positive headlines without the scrutiny that a new policy would entail.
The government seems to be considering extending the principle of its National Loan Guarantee Scheme to create investment in housing and infrastructure. This may not be on the balance sheet as borrowing, but the government would be taking responsibility for others’ debts. That sounds an awful lot like stimulus to us.
Just hours after Nick Clegg announced there will be a “massive” increase in housing and infrastructure investment, the Treasury are refusing to tell Left Foot Forward where the money is coming from.
The FT reported late last night that the deputy prime minister “sounded a new tone on economic policy”, suggesting the government would use its strong balance sheet to inject credit into the economy, following similar recommendations by the IMF yesterday.
Left Foot Forward spoke to the Treasury’s press office this morning to find out where the money was coming from. We asked whether the government intended these funds to be additional spending in the form of an effective Plan B, some form of quantitative easing from the Bank of England, or tax increases and further cuts to raise money for the proposed investment.
Instead of answering the question, Her Majesty’s Treasury refused to talk to Left Foot Forward, claiming they would only speak to national newspapers and major broadcasters.
This was a surprise for Left Foot Forward as, in the past, we have had no trouble speaking to the Department for Work and Pensions, the Department for International Development or the Department for education when researching stories.
Why have the Treasury suddenly decided they won’t talk to Left Foot Forward? Is it simply because the chancellor’s fiscal straightjacket means there is no money to fund the deputy prime minister’s ambitious claims?