By William James
LONDON (Reuters) – Britain’s opposition Labour Party challenged Prime Minister Theresa May’s government on Thursday to deliver immediately on its promise that nearly a decade of public spending cuts is coming to an end.
Chancellor of the Exchequer Philip Hammond will announce his annual budget next week, armed with better than expected public finances but needing to balance any largesse with caution over the huge uncertainty posed by Brexit.
Labour’s finance policy chief John McDonnell said Hammond must also flesh out a promise May has made to bring an end to austerity after eight years of public spending cuts designed to shrink Britain’s budget deficit.
“This budget will show us whether she is true to her word or not,” McDonnell said. “We need decisive action to end and reverse austerity, not some vague promises for the future and a few financial conjuring tricks.”
Responding to McDonnell’s speech, Treasury minister Liz Truss defended her party’s track record on the economy and said the government was working to grow the economy so more money was available for public services.
May told her party’s annual conference this month that “a decade after the financial crash, people need to know that the austerity it led to is over and that their hard work has paid off.”
Britain’s budget deficit has been cut from nearly 10 percent of gross domestic product in 2009/10 to under 2 percent in the last financial year.
McDonnell’s speech was accompanied by a dossier outlining Labour research into the extent and impact of spending cuts on areas such as health, education and local services. It said 30 billion pounds of new funding was needed to stop planned cuts, and nearly 80 billion to reverse cuts since 2010.
“What we’ve done in the dossier is to try and get Theresa May and Philip Hammond to focus on the impact of austerity,” he said. “We will seek to ensure not just that we end austerity, but actually reverse much of what’s been done.”
(Editing by Stephen Addison)