Responding to today’s Budget, Tom Railton, Director of the Invest in Britain campaign, said:
“The changes to the UK’s fiscal rules announced today by the Chancellor are a clear step forward.
“The previous fiscal framework trapped the UK in a doom loop of low investment and low growth. This has held back living standards, and led to crumbling public services and stagnating productivity.
“Crucially the changes to the fiscal framework announced today allow the government to borrow more to finance much-needed investment in our public services, clean energy infrastructure and a just transition to greener industry. These changes have enabled the Chancellor to cancel the damaging cuts to public investment planned by the last government.
“But cancelling the cuts cannot be the extent of the Chancellor’s ambitions. Despite today’s welcome change of direction, levels of public investment in the UK will continue to lag behind other G7 countries. Making up for years of inadequate investment and delivering its promise of a ‘decade of national renewal’ will require the government to set its sights much higher.
“The Chancellor has shown today that she understands the importance of public investment in driving growth and the health of the economy, and the OBR has confirmed these positive impacts. Her new fiscal rules must now lead to the substantial and sustained increase in public investment this country actually needs. That means not only investing in physical infrastructure and public services but also in social infrastructure and human capital – like childcare or skills – which also have long term economic benefits.
“The benefits of public investment are felt over the longer term, so allowing the OBR to model its impact over 10 years is a significant improvement. However, reducing the time-frame on the investment rule risks continuing the short-termist approach which has held back investment.
“It will also be essential that the new system of oversight the government has created ensures that new investments, especially financial investments, are genuinely serving the public interest.
“This Budget has laid an important foundation for future economic growth. The Spending Review next Spring must now be used to set out a more ambitious investment trajectory that can truly deliver a decade of national renewal.”
ENDS
Notes to editors
Invest in Britain is a project of the Economic Change Unit (ECU), a non-profit organisation that campaigns to change the way the economy works so everyone has the freedom and security to live a good life.
Invest in Britain is a new campaign calling on the government to focus on the long-term interests of the country and deliver a substantial uplift in public investment for public services, clean energy infrastructure, and just transition to good jobs in greener industries.
For more information please contact info@investinbritain.org.uk