Labour says would not borrow to reverse cuts

LONDON Sat Jun 22, 2013 1:57pm BST

Britain's opposition Labour party leader Ed Miliband delivers his keynote speech at the party's annual Spring Forum, in Birmingham, central England March 23, 2013. REUTERS/Phil Noble

Britain's opposition Labour party leader Ed Miliband delivers his keynote speech at the party's annual Spring Forum, in Birmingham, central England March 23, 2013.

Credit: Reuters/Phil Noble

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LONDON (Reuters) - The opposition Labour Party would not borrow more money to reverse spending cuts by Prime Minister David Cameron's coalition government should it win the next election due in 2015, its leader Ed Miliband said on Saturday.

Although polls show Labour has a lead of up to 10 points over Cameron's Conservatives, Miliband still needs to convince sceptical voters of his party's economic credibility and shrug off criticism it is wedded to spending money it does not have.

"If we win the election, we will come to power in tougher economic circumstances than we have seen in generations and that will have to shape the way that we govern," Miliband said in a speech to his party's National Policy Forum.

"Our starting point for 2015-16 will be that we cannot reverse any cut in day to day, current spending unless it is fully funded from cuts elsewhere or extra revenue - not from more borrowing."

Chancellor George Osborne is due to announce details next week of 11.5 billion pounds of cuts by government departments following a spending review in the latest effort to reduce a big public deficit.

Miliband is aware he need to restore Labour's image which was badly damaged by the 2008 crisis when it was in government, and his speech is the latest in a series of coordinated attempts to revive its economic reputation.

Labour was criticised for allowing Britain's budget deficit to peak at just over 11 percent of gross domestic product, and although the economy has struggled to recover under Cameron's tough austerity measures, Conservative attacks on Labour's record of borrowing and spending resonate with voters.

Miliband's speech echoed comments of finance spokesman Ed Balls said earlier this month that he would have "iron discipline" on spending.

"It's a hard reality. But people will only put their trust in us if we show we are credible," Miliband said.

Conservative Party Chairman Grant Shapps said Miliband was too weak to stick to his promise.

"Ed Miliband only offers more spending, more borrowing and more debt - the same old Labour approach that got us into this mess in the first place," he said.

(Reporting by Michael Holden; Editing by Toby Chopra)

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Comments (2)
2writestoo wrote:
For three years Merkel’s lap dog has had vehemently voted against every cut the government has proposed in an attempt to curry favour with his masters the lefti PC unions. However he now acknowledges the serious state of the UK economy and adopts the governments policies. Here is another Nick Clegg in the making. Better if he does what the other half of the Marxist brothers did buzz off out of the country to perhaps the lands of his fathers (Poland or Belgium) where he can stand as a Euro MP and so join the Brussels golden trough gobbles institution

Jun 23, 2013 7:30am BST  --  Report as abuse
skeptic wrote:
Who can believe that Labour will be the party of cuts as that goes against their party ethos? Labour will always believe in more centralised spending. Whatever Miliband says few will believe that Labour will reign in public sector spending. Miliband does not believe that Labour spending causes today’s UK debt problems see
Why would he feel obliged to keep down spending in future if he knows spending does not cause a problem?

Jun 23, 2013 1:34pm BST  --  Report as abuse
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