The Institute for Fiscal Studies (IFS) has analysed Labour Shadow Chancellor Ed Balls’ plans to match Chancellor George Osborne’s commitment to clearing the ‘current deficit’, noting that this doesn’t commit the Labour Party to clearing ‘overall deficit’ should it win power in 2015. In detail, this means that infrastructure and investment spending would be excluded from deficit calculations, allowing him to exceed the projected level of current Government spending by up to £25 million.
Pete from PSI: Whilst many commentators had concluded that Balls’ commitment to matching the Government’s deficit plans was a move to shore up the oppositions’ economic credibility amongst voters, this analysis by the IFS will play directly into the Government’s line of attack that the Labour Party cannot be trusted on the economy, as they will be too profligate with the public purse.
