Charter for fiscal responsibility – A trap for Labour or good law?

The Charter for fiscal responsibility is to be brought before Parliament today. It has already thrown the Labour Party into disarray.

On the face of it the common sense policy of putting money away in the good days for the inevitable rainy day makes sense. As it always has.

But what is not clear is why the Chancellor believes this needs to be enshrined in law. Any sensible Chancellor would be doing this anyway and would be held to account by the Office Of Budget Responsibility and Parliament. He tells Parliament his plans and he is held to account.

When growth is low and interest rates are low, as they are now, it makes sense to borrow for infrastructure projects. Any government which does not have the imagination to invest and get a return better than the current 2% is not a great government.

This law appears to have loop holes to allow any Chancellor to get around the law if and when required. 

Increasingly I can only conclude that this important subject is being used as a stunt by the Chancellor. Labour have fallen for the trap.

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One thought on “Charter for fiscal responsibility – A trap for Labour or good law?

  1. “Any sensible Chancellor would be doing this anyway…”

    Unfortunately, it appears that “sensible” is not very high on the list of necessary qualifications for Chancellors.

    Recently, it has in fact been the exception rather than the rule.

    Like

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