OBR personnel are currently before the Commons Treasury Select Committee to answer questions about their budget forecast. Labour MP Jeevun Sandher, who was busy parroting Labour budget lines on the airwaves last week, was confused that Reeves’ injection of £22.6 billion extra to the NHS won’t boost potential output. He claimed that output was revised down under the Tories thanks to ‘declining public health’ and complained that the OBR doesn’t think extra cash will now help…
OBR Chairman Richard Hughes slapped Sandher down:
“Myself and my predecessors have revised down our views of potential output pretty steadily since the aftermath of the financial crisis. Every country in the world has suffered a big hit to potential output, including those like the US who’ve continue to spend lots and lots of money on healthcare. The idea that there’s a direct link between how much are spending on healthcare and the potential output of the country is not demonstrated by the data.”
That is – chucking more money for day-to-day NHS spending won’t help growth. Hughes also pointed out no further plan has been spelt out by the Treasury: “We know very little about what the government’s plans are for healthcare spending after.“ So much for “Reform or die“…
At the same time MPs were shocked that it would only take a 0.3% increase in interest rates to entirely wipe out Reeves’ “fiscal headroom.” It’s not just the gilt market coming to terms with the scale of Reeves’ spending…
“A 1.3% increase in the interest rate… that actually results in the current balance in five years being in deficit by £11 billion, so you’re actually missing the rule by £11 billion… To get the current balance down to essentially zero so to take away all the current headroom, we have point three.“
The budget has already prevented faster interest rate cuts according to economists and boosted future inflation. Reeves’ pretend “fiscal stability” is a house of cards…
Statement by Paul Dacre, Editor-in-Chief of Associated Newspapers Limited, following Harry’s loss in court today:
“Prince Harry wrote a sad book which boasted about his killing of 25 Taliban, his drug-taking and, in cringe-making detail, how he lost his virginity. There isn’t a laundry in the cosmos big enough to wash all the dirty linen he has aired about his own family. For him, to complain about HIS privacy being invaded takes, not just the biscuit, but the whole tin. Poor Harry. I feel sorry for the way a confused and angry young man has been drawn into this case. The bitter irony is that his mother, Diana, liked the Mail. We were her paper. We took her side in her acrimonious break up with Charles. She and I would speak and meet. The Mail’s superb royal reporter was her friend and confidante. The truth is that this trumped-up action – which has cost well over £50 million and wasted a huge amount of valuable court time – should never have been brought to trial. That it did, raises profoundly disturbing questions about the conduct of elements of the legal profession. Today’s verdict is not just a victory for Associated’s magnificent journalists – several of whom have had a terrible toll imposed on their health and lives – but a free press generally. Make no mistake. This was a conspiracy, supported by Hacked Off, to destroy a paper. Financed by the orgy-loving, racist Max Mosley and involving the actor Hugh Grant, it was also a sinister bid to resuscitate Leveson Two and impose statutory regulation on the press which, even now, is rearing its ugly head in Labour’s Media Green Paper.”