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Sunak is right, Labour spending plans are stuck in a bind without tax hikes

City AM

 

 

Adam Hawksbee, Onward’s Deputy Director, discusses Labour’s spending plan in City AM.  He asserts that they could be in ‘bind’ with their plan to limit tax raises whilst committing to new investements.  He writes:

“The most eye-catching number among Labour’s pledges is their £28bn-a-year Green Prosperity Plan. Shadow energy secretary Ed Milliband’s package is what Sir Humphrey would describe as “courageous” – meaning, of course, that it could lose an election. Unsurprisingly, Labour’s extremely hawkish shadow Treasury team has repeatedly chipped away at the overall figure to reduce its electoral toxicity.

First they pushed the £28bn target back, explaining that a Labour government would “ramp up” to the total amount over five years. Later, shadow ministers clarified that £8bn of the pledge wasn’t new spending at all. But the Institute for Fiscal Studies has argued their plans would still see government capital investment 60 per cent higher than recent historical averages.”

You can read the full piece here

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