Tory accusations of unfunded spending commitments are flatly contradicted by the IFS.
Tory accusations of unfunded spending commitments are flatly contradicted by the IFS
In yet another sign of the General Election campaigns ramping up, the Conservatives will today accuse Labour of promising unfunded spending commitments of £20.7bn in the first year should they win the election in May.
The BBC has reported that five Tory cabinet members will say that Labour plans would amount to almost £1,200 extra borrowing for every working household in the UK.
Curiously, however, the Conservatives have failed to say how either figure was reached.
The accusations are presumably designed to hammer home the message that Labour still cannot be trusted to run the economy – as well as to solidify George Osborne’s lead over Ed Balls when it comes to who is the most trusted to run the country’s finances.
And yet the problem for the Tories is that their claims are flatly contradicted by the independent Institute for Fiscal Studies (IFS), which last month assessed the spending plans of the three main parties.
In fact, the IFS said (p.21) that Labour’s plans were the “most cautious”:
“Of the main parties, Labour has perhaps been the most cautious of the three in that, at least on the basis of its own costings, it appears to have managed not to announce an overall net giveaway. Just looking at tax and social security spending policies, Labour has announced a small net takeaway of 0.1 per cent of national income.”
Last year the IFS said that to meet its fiscal target the Conservatives would have to raise taxes or make even bigger cuts to spending than already proposed if they win power next year.
The independent research body noted that meeting the Conservatives’ fiscal target “would require tax rises or significantly greater cuts in public spending than Labour and the Liberal Democrats would require to meet their rules – on top of those that are already planned up to 2015–16”.
It also concluded that borrowing over this parliament was “on course to be substantially greater than the Office for Budget Responsibility (OBR) forecast back in June 2010”.
The three major parties are all committed to deep spending cuts after next year’s General Election, however the IFS has made clear that under a Conservative government the cuts in the next Parliament will be deeper unless they are offset by significant tax increases.
James Bloodworth is the editor of Left Foot Forward. Follow him on TwitterLike this article? Sign up to Left Foot Forward's weekday email for the latest progressive news and comment - and support campaigning journalism by making a donation today.