Investigators asked the Treasury which figures Chief Secretary to the Treasury Laura Trott was using and they were given the OBR forecasts for debt including the Bank of England’s balance sheet.
That figure is predicted to go up next year before falling in each of the following four years, which means it would be lower in 2028-29 than it is now.
But that is not the measure of debt that the government uses for its debt pledge, which is what Ms Trott was being asked about in a recent interview.
The reason you might exclude the Bank of England is that some of its activities to support the economy have involved temporary increases in debt, which are not really in the control of the government.
The documents accompanying the Autumn Budget in 2021 said: “excluding the Bank of England’s contributions to public sector net debt… better reflects the impact of government decisions”.
So on the measure of debt that the government uses for its own targets, it is not right to say that debt is falling or that it will be lower in five years than it is today.
Labour’s shadow chief secretary to the Treasury Darren Jones said: “Laura Trott, Jeremy Hunt’s number two, doesn’t even know the basic facts of her job.”
Talking about the debt today, Rishi Sunak said it was “on schedule” to fall.
This is the best summary I could come up with:
Chief Secretary to the Treasury Laura Trott and BBC PM presenter Evan Davis got into an argument about whether UK government debt is rising or falling.
The pledge is that debt as a proportion of the size of the economy, measured by Gross Domestic Product (GDP), should be on track to fall in five years time.
That forecast comes from the Office for Budget Responsibility (OBR) - an independent body that looks at the government’s plans on tax and spending - and makes economic predictions accordingly.
The reason you might exclude the Bank of England is that some of its activities to support the economy have involved temporary increases in debt, which are not really in the control of the government.
The documents accompanying the Autumn Budget in 2021 said: “excluding the Bank of England’s contributions to public sector net debt… better reflects the impact of government decisions”.
Labour’s shadow chief secretary to the Treasury Darren Jones said: “Laura Trott, Jeremy Hunt’s number two, doesn’t even know the basic facts of her job.”
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