§ Mr. Malcolm BruceTo ask the Chancellor of the Exchequer if he will estimate, in 1995–96 prices, the change in real value of the control total for public expenditure in(a) 1997–98 and (b) 1998–99 relative to the forecast in the November 1996 Budget, as a consequence of the new estimates of the GDP deflator contained in his Budget; and if he will make a statement. [9483]
§ Mr. Darling[holding answer 21 July 1997]: We are keeping to the inherited control totals for 1997–98 and 1998–99 as promised in the manifesto. There have been no cuts in the cash programmes set out in the 1996 Budget.
As set out in the 1996 and the 1997 Budgets, the real values of the control total, in 1995–96 prices, for the next two years respectively are £254.8 billion and £256.6 billion; and £252.3 billion and £252.2 billion.
In his Budget announced on 2 July, my right hon. Friend the Chancellor announced significant real increases for key priorities in 1998–99—NHS spending of 21/4 per cent. and for current spending on UK schools of 23/4 per cent. despite the higher inflation we inherited from the previous Government. We have also provided extra resources, as we also promised, under welfare to work and the capital receipts initiative which, as we have always made clear, would be additional to the control totals.
We will meet our obligations on these key priorities, but we will not lose sight of the need to keep a firm grip on inflation through the new framework for monetary policy and a close control on how we, as a Government, spend people's money. Cash planning without automatic inflation adjustments has been a key principle of spending control for two decades. It is not right to accommodate higher inflation by automatically increasing cash plans.