Prime Minister Boris Johnson’s Conservative Party said the opposition Labour Party would spend an extra 1.2 trillion pounds ($1.5 trillion) over the next five years if it wins power in an election on Dec 12, British newspapers reported on Saturday.
The Sunday Telegraph and Sunday Times newspapers quoted Conservative finance minister Sajid Javid as calling Labour’s spending plans “truly frightening” that would push Britain close to bankruptcy.
However, Labour’s would-be finance minister, John McDonnell, dismissed the Conservative estimates as “ludicrous” and a “mish-mash of debunked estimates and bad maths”.
Labour has not yet published full policy proposals, and the Sunday Times said the Conservative Party based the 1.2 trillion pound figure on Labour’s manifesto for the 2017 election and more recent policy pledges.
Britain’s top civil servant barred the finance ministry from publishing a costing of Labour’s policies last week, saying it would breach political impartiality rules.
McDonnell said in an interview for the Sunday’s Independent that the party’s manifesto would be “the most radical ever” and include a pilot for a universal basic income, and reiterated his desire to block expansion of London’s Heathrow airport.
The Conservatives currently enjoy a sizeable lead in opinion polls over Labour at the start of the campaigning for December’s election, which Johnson called early in a bid to break the parliamentary impasse over Brexit.
Separate polls for the Mail on Sunday and Observer newspapers both put the Conservatives on 41% and Labour on 29%, while a Sunday Times poll put the Conservatives on 39% and Labour on 26%.
Both Javid and McDonnell unveiled significant spending plans last week.
Javid, a 49-year-old former Deutsche Bank financier, said he would rewrite the country’s fiscal rules so he can spend an extra 20 billion pounds per year, raising borrowing for infrastructure to 3% of economic output from its current 1.8%.
McDonnell, 68, promised to borrow and spend even more – 400 billion pounds over 10 years. He said interest payments on government borrowing should not exceed 10% of tax revenues.
Like in many advanced economies, British government borrowing costs are currently close to record lows.
But on Friday credit ratings agency Moody’s assigned a negative outlook to Britain’s sovereign rating, blaming Brexit-related policy uncertainty and a lack of political will to reduce debt.
Britain’s public debt currently stands at around 1.8 trillion pounds, more than 80% of economic output – though below equivalent amounts in the United States, Japan and France.
