Government Performance against Fiscal Rules

Mel Stride Excerpts

Monday 7th July 2025 Commons Chamber

[Sir Mel Stride (Central Devon) (Con)]

(Urgent Question): To ask the Chancellor of the Exchequer if she will make a statement on the Government’s performance against the fiscal rules.

[The Chief Secretary to the Treasury (Darren Jones)]

As the shadow Chancellor knows, it is a long-standing convention of this and previous Governments not to provide a running commentary on a fiscal forecast, and it is for the independent Office for Budget Responsibility to assess performance against the Government’s fiscal rules in its official economic and fiscal forecast. In the most recent forecast, published in March alongside the spring statement, the OBR confirmed that the Government were on track to meet their fiscal rules two years ahead of target. It also confirmed that the Government were on track to meet their fiscal rules early in the Budget last autumn.

This is a choice—a responsible choice. When we contrast it with the actions of Conservative Members, who lost control of the public finances, we see working people across the country still paying the price. In line with the usual process, the Chancellor will ask the OBR to produce a new fiscal forecast in the autumn for the annual Budget. That forecast will include an updated assessment of the Government’s performance against their fiscal rules. As the Prime Minister confirmed last week, the Government are committed to their fiscal rules, which remain non-negotiable.

We have seen what happens when fiscal rules are put to one side—[Interruption.] Conservatives Members may be chuntering from their sedentary positions, but families across the country are still paying the price of the consequences of Liz Truss’s experiment through higher mortgage payments, and we are not going to put the nation’s finances at risk as the Conservatives have done. In contrast, this Government are meeting their fiscal rules and, as a consequence of the Chancellor’s decisions, we are investing billions of pounds in the renewal of Britain: in schools, hospitals, affordable homes and public transport and in keeping the nation safe. Any future fiscal plans will be set out at the Budget in the normal way.

[Sir Mel Stride]

The Chancellor said that she would not make any commitments that were not

“fully funded and fully costed”,

but the Chief Secretary to the Treasury has just said that he now expects us to wait until the autumn to hear how the Government intend to cover the £6 billion of unfunded commitments that their U-turns have run up in the last month alone. A Government divided. A Government racking up unfunded spending. A Government wrecking the public finances. Why is the Chief Secretary not prepared to explain how they will fund these U-turns? There are surely only two possible answers: either the Treasury has made them without a clue as to how they will be funded, or it knows but is refusing to tell us. Either is completely unacceptable. Can the Chief Secretary set aside the usual blather that we have just heard and tell us whether he knows how these unfunded commitments will be paid for, or are his Government simply refusing to say?

The House will also have noted the inherent contradiction in the Chief Secretary sticking to the line that decisions will be made at a fiscal event in the normal way, when that is precisely what the Government have not done. By losing control of the finances and of their own parliamentary party, the Government have made significant fiscal decisions outside of a fiscal event. The Chancellor said at the Budget that she would not be coming back with more tax rises. Is this still the position? Will the Chief Secretary rule out a wealth tax, along with reconfirming there will be no rise in income tax, national insurance or VAT? The Chancellor said that she would not extend the freeze on tax thresholds because it would hurt working people. Is this still the position? Can the Chief Secretary confirm that the Chancellor will not be adding to her fiscal black hole by scrapping the two-child benefit cap? Can I also ask whether consideration—

[Madam Deputy Speaker (Caroline Nokes)]

Order. The shadow Chancellor will know the time limit. I am sure that this will be his last sentence.

[Sir Mel Stride]

It certainly is now, Madam Deputy Speaker. If Ministers are to begin putting their house back in order, that must start right now with full transparency and proper answers.

[Darren Jones]

I think the House knows what losing control of the public finances looked like, because under the previous Conservative Government interest rates went through the roof, families were paying higher mortgage rates and the Chair of the Treasury Committee was calling out the irresponsible behaviour of Liz Truss and her Ministers in the Treasury. That is what losing control of the public finances looked like and that is why the Conservative party lost control of Government and is in opposition today. The right hon. Gentleman asked me to comment on forecasts of annually managed expenditure and on future tax decisions. He knows how this works. All of that will happen with a forecast and a Budget, which will happen in the autumn.

--- Later in debate ---

[Andrew Lewin (Welwyn Hatfield) (Lab)]

I always listen attentively to the shadow Chancellor, in this place and in his many media rounds. Sadly, what is missing is a costed economic policy of his own. Does my right hon. Friend agree that the shadow Chancellor might be wise to spend some quality time in his beautiful Dorset constituency—

[Sir Mel Stride]

Devon.

[Andrew Lewin]

Apologies—in his Devon constituency over the summer to develop some credible policies of his own? If he does not, he is not credible from the Dispatch Box.