McDonnell demands end to ‘failed austerity’

Written By: Ian Hernon
Published: March 11, 2018 Last modified: March 11, 2018

Shadow Chancellor John McDonnell has called on the government to use its spring statement to end an “immediate crisis” in public services and ditch its failed austerity programme.

McDonnell (pictured) said recent economic figures were “not a matter for celebration” – and insisted Chancellor Philip Hammond should “get real” in his upcoming spring statement.

He said Hammond had “shifted the deficit onto the shoulders of NHS managers, headteachers and onto the shoulders of local government leaders”.

And he added: “They’re facing a financial crisis because of government cutbacks,” calling the proposed NHS pay deal “miserly and mean-spirited”.

But Hammond rejected all calls to announce the end of austerity, even though he is expected to unveil the smallest budget deficit since 2002, thanks to better than expected public finances.

He said the UK’s national debt was still too high and there would be no easing of spending restrictions. “There is light at the end of the tunnel,” he said, adding: “We are still in the tunnel at the moment.”

He said it was a “very important moment” to see debt starting to fall after growing for 17 continuous years.

But he said: “We should be very careful looking at single sets of figures – one quarter or two quarters – we need to look at what’s happening sustainably in the economy.”

The day-to-day deficit has been eliminated, it emerged earlier this month, two years later than former chancellor George Osborne had wanted when he set it in 2010.

The UK is now running a surplus of £3.8bn in its current budget – the money borrowed to fund day-to-day spending rather than long-term investment – according to the Office for National Statistics.

About Ian Hernon

Ian Hernon is Deputy Editor of Tribune