Labour leader opens door to more borrowing
Sir Keir Starmer has suggested a potential shift in debt rules to allow for increased borrowing, sparking fears of a massive spending spree. The Prime Minister hinted at the importance of borrowing to invest in key infrastructure projects, potentially paving the way for an extra £20 billion in Budget headroom.
Expert backing for financial flexibility
Chancellor Rachel Reeves is set to deliver her Budget on October 30 amidst calls for more financial flexibility. Former Cabinet Secretary Lord Gus O’Donnell and ex-Tory Minister Lord Jim O’Neill have supported the move, warning that years of under-investment have left the UK in a cycle of stagnation and decline.
Concerns over current financial framework
Experts caution against sticking to spending plans set by previous administrations, highlighting the need for a shift towards a "decade of national renewal." Independent forecasters predict national debt could soar to 274% of GDP by 2071, with risks including war, disease, and trade tensions further exacerbating the situation.
Call for reform and financial sustainability
The OECD has urged Ministers to reform the triple lock system to ensure public finances are on a sustainable path. The triple lock boost guarantees an increase in the state pension each April, aligning with inflation, wage increases, or a minimum of 2.5%.
