The Transport Secretary has been unable to explain how Burnham’s £2 bus fare cap – a Tory policy – will be funded. A Downing Street release states it will be majority funded by converting £400 million international climate finance grants into loans…
Heidi Alexander said:
“The detail of it needs to be worked through. But in order for loans to qualify as overseas development assistance, the terms of the loan need to be reasonably favourable to the developing country and it needs to contribute to developing that country’s economy. So it makes sense to switch the spending. Instead of it being a grant, it will be a loan, and that frees up money to spend on domestic priorities, to spend on our public transport.
The detail will need to be worked out… You will appreciate that I’m not going to sit in your studio and tell you how something will work when the detail hasn’t yet been worked through… I’m not going to give you the detail. I don’t have the detail to give you.”
Burnham’s government is simultaneously insisting that the loan conversion frees up all the cash while the loans themselves are so generous in their terms that they still count as ‘aid.’ Cuckoo…
Andy Haldane, Burnham’s recent adviser on the economy who has not taken up a No10 job, told Andrew Marr on LBC:
“The market now suspects that this is a traditional tax-and-spend socialist government with better TikTok videos…
imposing windfall taxes on oil & gas or on banks or upping capital gains tax would […] repeat the mistake that Rachel made […] The Achilles heel, the fiscal Achilles heel of this government thus far has been its unwillingness and/or inability to cut public spending.”