Government Performance against Fiscal Rules

Lord Watts Excerpts

Tuesday 8th July 2025 Lords Chamber

[Lord Livermore (Lab)]

There are two things here: the fiscal framework and the fiscal rules. On the fiscal framework, we have moved to one fiscal event a year, which is the November Budget. There are two fiscal forecasts, in the spring and in the autumn. The noble Lord is absolutely right: we should not give a running commentary on the fiscal forecast. That is, quite properly, for the Office for Budget Responsibility to do. It will do that in the usual way ahead of the annual Budget, and then the Chancellor will make decisions based on that forecast.

The noble Lord talks about the fiscal rules. The one thing I will say is that the changes to the fiscal rules that we made when we came into office were to enable us to invest sustainably in infrastructure and in public services, to stop the cannibalisation of investment to patch up day-to-day spending which we saw under the previous Government. It is interesting that the party opposite has opposed that change to the fiscal rules yet still supports the additional investment that that changed fiscal rule brings. Again, I am not sure that that is entirely consistent.

[Lord Watts (Lab)]

My Lords, will the Minister rule out following the example of the Truss Government, who crashed the economy? Has he received an apology for being left such a sad state of affairs in the economy that we have inherited?

[Lord Livermore (Lab)]

My noble friend is absolutely right. It is exactly because of the experience of the previous Government—that disastrous Liz Truss mini-Budget, which saw mortgage rates spiral and from which working people are still suffering higher mortgage payments—that it is so important that we maintain fiscal responsibility and why we absolutely continue to adhere to our fiscal rules.