Public Spending Targets (Hansard, 18 April 1996)

§ 4. Dr. Wright
To ask the Chancellor of the Exchequer what plans he has to review his public spending targets. [24309]

§ Mr. Waldegrave
The Government's objective for public spending is to reduce it as a share of gross domestic product over time, and in particular to reduce it to below 40 per cent. The last Budget set out plans to achieve that in 1997–98. If we can go further than 40 per cent. we will, and the target is constantly reviewed.

§ Dr. Wright
Is the Chief Secretary aware that Opposition Members follow the Chancellor's predictions with considerable interest? We particularly enjoyed his recent prediction that, because the electors of South-East Staffordshire now felt so good about the Government's economic policies, they would show their appreciation in the usual way. In view of the current state of the Chancellor's predictions on both growth and borrowing, 831 is it not the case that he will be able to deliver a pre-election tax bribe only at the expense of public spending cuts of a savagery that he personally would find unacceptable? Although Opposition Members might understand that, has the Chancellor the slightest chance of explaining it to the ideological warriors seated behind him?

§ Mr. Waldegrave
We do not follow either the predictions or the opinions of Opposition Front Benchers with much interest, because they have no predictions or opinions. That is one of the problems of debating economics in the House. My right hon. and learned Friend the Chancellor has delivered an economy that is working more strongly and stably than, perhaps, at any point in my lifetime, and I think that he and the House should be proud of that.

§ Mr. John Marshall
I thank my right hon. Friend for his answer. It will be warmly welcomed by most people, who realise that lower taxes will come only from lower Government expenditure. Would not public expenditure soar under a Government whose members approached every problem with a blank cheque?

§ Mr. Waldegrave
We have hit our spending targets in each of the past four years, although they have been tough, and I intend to ensure that we hit them again this year. I do not think that any serious economic commentator believes that Labour could keep spending at the levels that we have planned, but we will do so.