A sign that politics is now all about the economy is that a story with words ‘fiscal rules re-writing’ can lead the morning news bulletins. This from the BBC:
The government is considering re-writing its own rules on how much it can borrow in order to counter the effects of the economic slowdown.
The new framework, which could be announced in the Autumn pre-Budget statement, would permit more borrowing as an alternative to increasing taxes. … the Treasury stressed no decision had yet been taken.
The Lib Dems’ shadow chancellor Vince Cable has once again called on the Government to place its fiscal rules in the hands of an independent body to avoid suspicion of expedient political meddling. Speaking on BBC Radio 4’s Today programme this morning Vince slated Mr Brown’s latest ploy to creatively account for an £8bn tax revenue shortfall: “It is embarrassing and almost humiliating for the government.”
Here’s Vince’s official statement:
The fiscal rules have no credibility when the Government keeps fiddling or changing them. This step underlines what I and my colleagues have said for years, the assessment of fiscal policy must be made by an independent body in the same way interest rates are determined.
“It’s completely lacking credibility for the Treasury to be marking its own exam papers and setting its own questions. What we need is an Ofsted for the economy.”
(Though I’m not entirely convinced that creating “an Ofsted for the economy” is one of the most convincing arguments I’ve heard).
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6 Comments
While “an Ofsted for the economy” may not sound too appealing, I think that’s more to do with the image of Ofsted in our minds, thanks to the govt constantly tweaking with the school system.
I think it would be great if the chancellor had the same fear coming up to a budget as school staff have when Ofsted are about to do an inspection.
Perhaps he might then cut high red tape taxes, instead of abandoning green tax rises.
http://fiscalreform.blogspot.com
I don’t think the Chancellor has ever defined the beginning and end of the economic cycle in any case. Vince has asked on several occasions what their estimates are for the beginning and end dates.
Without that any measure of balance across the cycle is meaningless.
Vince Rocks
Any credibility Labour had on the economy was mis-founded. Any authority they had on the economy is being shredded. Any remaining choices to improve the situation are politically damaging for them.
Talk about being backed into a corner!
i can not understand why a vote of no confidence has not been put against labour from your selves or the conservertives how can you run an econemy for ten years on crsdit card borrowing and mortgadge borrowing cap in hand with the bank of england brown and blair have built the housing bubble so people have drawn eqerity from property to live and now by the hour all the money being given out in browns golden econemy years is being written off the northern rock is labour every thing about its collapse tipyfies what labour has done to this country and the story continues bank after bank going under surley the police must get involved with this mass fraud thats gone on it was labours job to run the country not the banks how can these city bankers have walked away with these huge bonases based on fraudand irrisponsable lending and now were all suposed to sit back while we watch the bank of england with labour bail out the mess with tax payers money sombody needs to stand up and tell this country what the credit crunch means not just an easy word to pass over the mess they have got us in credit crunch means banks that have run the econemys on there self inflated housing bubbles creating false wealth both in america and here the econemys have been built on this and are now collapsing on this and yet nobody seems to pick this up and let mr averedge see this this could bring this goverment down
Almost humiliating? The image it conjours with me is of a gambler crawling on the floor looking for a dime to put in a slot machine. Totally humiliating is nearer the mark.
But Vince is a nicer chap than me.