"Labour’s spending addiction will trap the economy in a state of permanent lockdown"
Telegraph: 29th October 2024: PopCon Director, Mark Littlewood, comments on Labour Govenment's budget
"Stability and growth. This is what we were promised by the incoming Labour government, alongside a now unravelling pledge that taxes would not be raised for working people. Having boxed themselves into so many fiscal corners, tomorrow’s Budget is going to fall somewhere in the range from painful to agonising...
We can expect the Chancellor to reel off a whole series of supposedly unexpected time bombs... However, to fret about these so-called black holes is akin to worrying about your house burning down because you left a ten pound note down the back of the sofa...
The key failure lies in the working assumption that state expenditure must continue to grow and all other economic furniture needs to be rearranged to meet this objective. Unfortunately, the bald facts of economic life make this a fruitless and dangerous endeavour for four key reasons...
First, taxation and spending are already eye-wateringly high...
Second, living beyond our means has now become the norm... The consequence is that servicing debt now costs more than the state education budget... further borrowing will become exponentially more costly...
Third, the longer-term demographic and accompanying fiscal picture is dire. State promises on future benefits – both the universal state pension and the absurdly gold-plated public sector pensions – are essentially unfunded...
Finally, economic growth is increasingly just prayed for by politicians rather than positively pursued...
A monumental retrenchment of state expenditure is coming at some point and the longer we wait the more painful it will be. Sadly, tomorrow’s Budget will simply be another step in the Government..."