Financial Times FT.com

Tough decisions on how not to spend it

By Chris Giles, Economics Editor

Published: August 4 2006 03:00 | Last updated: August 4 2006 03:00

Are you ready for the national debate on the future priorities for public spending and public services? Gordon Brown, the chancellor, announced it in the Budget and the Treasury still promises events will unfold in the autumn. Such a debate, if it is meaningful, is sorely needed. Decisions on the size and role of government should be taken in the open. Ministers can muddle through each year but the big choices are simply made by default.

Any rational debate on public spending must start with the facts. After two years of famine between 1997 and 1999, Mr Brown gradually turned on the public spending taps. The next financial year will be the eighth in a row with faster growth of planned public expenditure than the sustainable rate of growth of the economy. In 2007-08, the current plan is to spend £583bn or 43.1 per cent of gross domestic product, up from 37.4 per cent in 1999-2000.

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