Government Borrowing: Economic Impact
Tuesday, 3 November 2026
Contributions
Andrew Rosindell (Romford) (Reform)Reform UK
6. What assessment he has made of the potential impact of levels of Government borrowing on the economy.
The Parliamentary Secretary to the Treasury (Torsten Bell)Labour
The Government are bringing down borrowing, helping to bear down on inflation to support households and businesses. Last year, borrowing fell by 0.7% of GDP to its lowest level in six years, and borrowing is forecast to fall across the forecast period to 1.8% of GDP by 2031-32.
Does the Minister understand just how devastating the effects of his Government’s spending, taxing and borrowing policies are for my constituents in Romford? Does he recall that the last time we had a Prime Minister who understood that we need low taxes, a smaller state and lower borrowing was in 1990? Then the national debt was 21% of GDP; now it is heading for 100%. Will he please reduce the size of the state, cut taxes for hard-working people and start to live within our means?
This Government are bringing down borrowing. That is why the IMF has said that the UK saw the biggest reduction in the G20’s deficit levels this year. It has said that the UK stands out for having a borrowing reduction plan, with borrowing falling every year across this forecast. The hon. Member was of course a member of a Government who saw debt levels go through the roof over the past 14 years. This is a Government getting on with reducing our borrowing so that we can bring debt down in the longer term. The only numbers that Reform Members talk about is how many millions of pounds their boss can take from crypto-billionaires around the world. We will deal with the public finances. Stop taking money from the crypto-billionaires!
Mr SpeakerSpeaker
I call the Chair of the Treasury Committee.
Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)Labour (Co-op)
Borrowing is high and I welcome some of the measures in the Budget, but we need to look at how every pound of taxpayers’ money is spent. Will the Minister reassure me that he and in particular his colleague, the Chief Secretary of to the Treasury, will be holding every spending Department tightly to account in the spending review, not just for future spending but for managing existing projects, so that every tax pound is spent as wisely as possible?
My hon. Friend is, as always, right. The Chief Secretary to the Treasury has heard every word she has said. There will be a spending review next year. It is important that we debate not just the levels of that spending, but how we ensure every single pound is spent well, whether on defence, health, education or anything else.
I call the shadow Minister.
Richard Fuller (North Bedfordshire) (Con)Conservative
That was a shockingly complacent response by the Government Minister. The latest Office for Budget Responsibility forecast shows that this Labour Government will borrow nearly a quarter of a trillion pounds more in just two years, this year and next year, costing every household an extra £476 a year in additional debt interest. Does the Chancellor accept not only that was this Budget a lost opportunity to bring borrowing under control, but that Labour’s addiction to borrowing is bleeding the British people dry?
Our record is reducing borrowing. The hon. Member’s record is being a Minister under Liz Truss. What is the Leader of the Opposition’s big idea now? It is appointing the Liz Truss fanboy and coming back to the Liz Truss playbook, promising over £30 billion of unfunded tax cuts. The Conservative party is offering lettuce-wilting levels of fiscal incontinence.
Source: UK Parliament Hansard API. Debate ID: 5430953.