Some of the entries reveal that there had been a long-running concern about public expenditure levels in some Labour circles. After the bank bailout in the autumn of 2008 which led to a sharp drop in the tax yield from financial services and stamp duty, the consequences were inevitable.
13 May 2008
21 October 2008Later, in the Library corridor, I came across a loyalist colleague who was lamenting the ‘awfulness’ of Gordon. He added, ‘The truth is that public expenditure has been out of control for the last three or four years because there are so many sacred cows ...’
24 November 2008During tonight’s Division, a former Treasury minister whispered that, about a year after we were elected, he took part in a two and a half hour meeting at which officials briefed Gordon that our apparent prosperity was built on unsustainable levels of debt and that, sooner or later, the bubble would burst. Gordon rejected the advice and the rest is history. In fairness, let it be said that Gordon no doubt took the view that this was an attempt by officials to nobble Labour’s spending plans before we had our feet under the table.
22 April 2009To London for Alistair Darling’s pre-Budget statement. ...Billions splashed about everywhere in a desperate attempt to kick-start our ailing economy. ...Of course it will all have to be paid for but not until well after the next election.
21 May 2009Budget Day. A budget anticipated like no other in recent history. A last throw of the dice as we contemplate oblivion. ...borrowing is predicted to rise to a shocking 11.9 per cent of GDP and the books are unlikely to balance again before another decade or more. So much for having ended boom and bust. The Tories were surprisingly subdued. As well they might be. This could be their inheritance. ...Cameron’s response (‘the government has run out of money and moral authority’) was devastating, provided of course that one forgets that all this stated with his irresponsible friends in the City.
6 July 2009This evening, as I was departing, I ran into Chief Whip Nick Brown. ‘Between you and me,’ I said, ‘given that we are going to lose the election we should be planting a few booby traps.’ I had in mind a few modest measures such as the selection of select committee chairmen.‘I think we’ve done that with the PSBR,’ replied Nick, smiling wickedly.
29 September 2009To the meeting of the parliamentary party ... Our debt, [Darling] said, would rise to 80 per cent of national wealth ‘because we took a deliberate decision to increase spending up to 2011. We will need to halve the deficit over a five-year period. ...’
9 December 2009[Labour Party Conference, Gordon Brown’s speech] ...Of spending cuts, there was scarcely a mention, which leaves us just a teeny bit vulnerable, since much of what was promised seems to involve more, not less, public spending.
24 March 2010Alistair Darling delivered his pre-Budget report. ...Re the deficit (a whopping £178 billion), containment rather than reduction is the strategy. It will not go down next year, but he did talk vaguely of halving it in the four years thereafter. ...The great unanswered question is, of course, how we are going to extricate ourselves from the vast swamp of debt into which we have been sucked by the avarice and stupidity of the bankers.... For all his bombast, one suspects that George [Osborne], too, is none too keen to go into detail this side of an election as to precisely how the Tories would tackle the deficit. The electorate would run a mile, if only they knew.Only Vince Cable affected to remain above the fray, pouring scorn in equal measure on both our houses while at the same time leaving us none the wiser as to what he would do either.
PSBR – Public Sector Borrowing Requirement, the UK government budget deficit (excess of spending over income) now called the Public Sector Net Cash Requirement (PSNCR).... Some good news – the deficit is £11 billion less than previously expected, but still a whopping unsustainable £167 billion.