Ed Balls: I won’t reverse any policies from George Osborne’s budget


Balls: “From yesterday to be honest… there’s nothing I’m saying to you from yesterday I would reverse”

LABOUR shadow Chancellor Ed Balls has said he would not reverse any of the policies in the coalition government’s new budget, announced on Wednesday by George Osborne.

Asked by the BBC’s Today programme if he would reverse measures like interest tax free for the first PS1,000 for savers, increasing the personal allowance or help to buy pension annuities, Balls replied that he would continue with all of those policies.

“From yesterday to be honest… there’s nothing I’m saying to you from yesterday I would reverse,” Balls added.

Balls claimed there wasn’t much detail in Osborne’s budget, but what he would reverse is Osborne’s overall plan for “deeper spending cuts over the next three years than the whole of the last five years.”

The Office for Budget Responsibility (OBR) has said that cuts announced by Osborne for 2016-17 and 2017-18 will be deeper than anything announced in one financial year of this term of the UK Parliament, but that for the last year of the next parliament, 2019-20, public spending would rise by four per cent, leading the OBR to describe the plans as a “rollercoaster”.

Stewart Hosie MP, SNP deputy leader, said Labour “has now confirmed there would be no respite for Scotland by agreeing with the proposed Tory cuts”.

“Under Osborne’s plans – and now Labour’s plans – there will be additional cuts to welfare, tax credits and public sector pensions, with overall cuts set to be far larger than anything we have seen over the past five years,” Hosie added.

Balls acknowledged that the Tories’ cuts to the deficit over the last five years have ended up being very similar to what Alistair Darling, Labour chancellor in Gordon Brown’s government, proposed in 2010 – that the deficit would be cut by half. Balls said the difference is Labour would have cut the deficit “fairly”.

The STUC president, Grahame Smith, said that Osborne’s plan to allow pensioners to turn their annuities into lump sums of cash was “a charter for the kind of abuses that have characterised the UK financial services for the past three decades”.

On raising the personal allowance, Smith said it would be expensive and do “nothing for the five million lowest paid workers and will benefit most those in the top half of the income distribution”.

“Measures to incentivise saving simply won’t resonate with those for whom saving is impossible,” Smith added.

Osborne’s budget has been described by many economic commentators as a rowing back on austerity plans, as he intends to have a budget surplus by the end of the next parliament of PS7bn rather than PS23bn.