Former Bank of England chief economist Andy Haldane says Tory growth policies ‘far more likely to succeed’ than Labour’s
At one point in the summer Andy Haldane, the former chief economist at the Bank of England, was informally advising Andy Burnham. Haldane spent most of his career as an official at the Bank. He is not a party political figure. But at the Bank he was viewed as an independent thinker, he was brought up in the north of England and he is committed to regional growth (which is one reason why Michael Gove hired him as a levelling up adviser).
But any suggestions that Haldane is a Burnham supporter have now been quashed by an article Haldane has published in the Financial Times. In it, he says the Conservaties’ economic policies are “far more likely to succeed” than Labour’s.
He says:
In the decade since Brexit, both parties have swung simultaneously right on social policy and left on economic policy. The interventionist economic agendas of Conservative prime ministers Theresa May, Boris Johnson and Rishi Sunak would not have been out of place under New Labour. At the 2024 general election, only a vape wrapper separated the parties’ economic manifestos.
Today, those differences are stark. Andy Burnham’s conference speech was a homage to 1950s-style state socialism. Kemi Badenoch’s speech was also a throwback, but to the smaller state and lower taxes of the 1980s. Which offers the more likely path to growth?
In today’s straitened circumstances, the rightward fork is far more likely to succeed.
Haldane argues the Tories have not always been right. He says George Osborne’s austerity policies were a mistake.
At the time of austerity, UK government debt was not only far smaller than it is today, but the cost of servicing it was lower than at any time in human history. Remarkably, the country’s long-term borrowing costs were negative in inflation-adjusted terms for protracted periods. There will probably never have been a better time for public investment.
Yet funding was cut and a £2tn investment gap opened up relative to international competitors, stunting growth. Veering right was wrong.
But, in the current circumstances, Conservative policies would be best for growth, he says.
Today’s fiscal environment is fundamentally different. Long-term borrowing costs have risen 4-5 percentage points and now sit above estimates of the UK economy’s long-term nominal growth rate. That signals the need for primary fiscal surpluses, on a sustained basis, if the UK’s debt dynamics are to stabilise.
The Labour party’s plan for an expansive (and expensive) state sits uncomfortably with this precarious fiscal backdrop. It also sits oddly with the fact that public-sector productivity has failed to rise this century. Both state financial capacity and personnel capability are at present sources of economic weakness, not strength.
In this debt-laden environment, the pursuit of a larger state is more likely to crowd out than crowd in growth. It also runs the risk of a loss of confidence in bond markets that causes borrowing costs to ratchet — think “Liz Truss-plus” …
The Conservatives’ economic plans are better suited to that task: for example, through cuts to business and employment taxes and regulation to unleash animal spirits; and by slimming government spending to lower borrowing costs, as the IMF and Bank of England have recently highlighted.
Key events
Reform UK MP Danny Kruger suggests Muslims may find it hard to be loyal to Britain due to their faith
The Reform UK MP Danny Kruger is an evangelical Christian. In his speech at the rally in Portsmouth earlier, he made an explicit link between Britishness and Christianity, and he implied that British Muslims might find it hard to be loyal to the country because of their faith.
Here is the passage from his speech in full.
We need an idea that binds us together, and that idea is deep in our roots. It’s the idea that King Alfred took from the Bible and made into the basis of the laws of England; that we are not just solitary individuals sharing a piece of land; we are bound together, not by race, but by our common commitment to the traditions of our country, the traditions we have inherited from generation upon generation.
And the founding tradition is that the official religion of the United Kingdom, from the coronation oath to every parish in the land, is Christianity.
And so and so when we see millions of people who are taught to believe something different, who are taught by their clerics that their loyalty isn’t to the United Kingdom, but to the global Islamic community, that your religion is in fact a political allegiance and it’s not to Britain, that is a problem.
And the problem isn’t with individual Muslims, far from it. In fact, I think we could win support from British Muslims if we offer them a better way – strong values, family, community, country, the things Reform stands for. I think Muslims, like everyone, would resonate with that.
But there can be no negotiation with this. If you’re a British citizen, your loyalty is to the British state. Your allegiance is to Britain. And that’s what Reformers feel in their bones.
Of course, not all Reformers feel loyalty to the British state in the bones. The party’s former leader in Wales, Nathan Gill, is serving a long prison sentence for taking money to speak up for Russia in the European parliament.
Scottish government says closure of BBC Scotland’s TV channel ‘wholly unacceptable’
The BBC Scotland TV channel is to close as part of cuts announced today. Michael Savage has the story.
In response, the Scottish government said this was “wholly unacceptable”. Màiri McAllan, the Scottish government’s culture secretary, said:
The proposal to close the BBC Scotland channel is wholly unacceptable and the Scottish government opposes it in the strongest possible terms.
This represents a significant blow to our media landscape and is the latest example of a longstanding pattern of BBC underinvestment in Scotland, raising serious questions about the broadcaster’s commitment to Scottish audiences and the creative sector, and its public service obligations to serve all parts of the UK fairly and equitably.
I have set this out directly with the BBC Scotland director and will engage with Ofcom to make clear the significant concerns this proposal raises.
Isle of Man could see first assisted death in 2028 after law gains royal assent
Assisted dying has formally become law in the Isle of Man in what has been hailed “an important step forward” which could see the first assisted death take place in late 2028, the Press Association reports. PA says:
Tynwald became the first parliament across the UK and Crown Dependencies to agree a framework for assisted dying in March 2025 but it was only on Tuesday that royal assent was granted.
It is thought the implementation period for an assisted dying service to be in place could be up to two years, with further work around training, codes of practice for healthcare professionals and capacity for applicants to take place in the meantime.
GP Alex Allinson, a former member of Tynwald who brought the bill through the island’s parliament, said he believed the 2028 timescale is “achievable”.
He said: “The announcement of royal assent marks an important step forward for our island. There is considerable further work to be done to draw up codes of practice and guidelines with healthcare professionals and provide holistic education and support for all those involved.
“Key to improving choice and dignity for those facing a terminal illness is investment in palliative care and expanding the choices available for the people of our island and their families.”
Government says Covid inquiry report shows why culture of care workers being undervalued has to end
Andy Burnham has released a Commons written statement giving his response to the Covid inquiry’s report out today. He particularly endorses its finding that “for too long the adult social care sector has been undervalued and under-recognised”. He says:
The government is committed to learning the lessons from the inquiry and ensuring the social care sector are prepared for a future pandemic. We will consider carefully the findings and recommendations of the report and respond in due course. We will use these findings to continue development of our adult social care pandemic action plan, and we will also respond to Baroness Casey’s review when it is published.
I have set out my vision for a National Care Service. This will be person-centred, highly integrated with health services and preventative in its character, helping people lead as independent and fulfilling lives as possible and providing dignity and peace of mind. We are delivering reform through significant additional investment in adult social care, including introducing a fair pay agreement for care workers and developing a new workforce action plan. We are also appointing a champion for unpaid carers, developing neighbourhood health services, and taking immediate action on adult safeguarding, dementia, and motor neurone disease.
Commenting on the report during health questions in the Commons, Yvette Cooper, the health secretary, said:
We will provide a full response to the report’s recommendations in due course, but I agree with the chair when she says, adult social care has, for too long, been undervalued and under-recognised.
That has to end, and I hope we can work cross party to support the prime minister’s vision for a National Care Service in the future.
Farage claims ‘snobbery’ part of the reason why racist views of Reform UK members getting so much criticism
Nigel Farage has given an interview to Sky News in which he has set in detail his response to the ITV News exposé highlighting the extreme racism of some of his party’s members. In it, he went beyond the line he used in his rally speech about his members not being “uniquely awful”. (See 3.24pm.) Here are three lines from the interview.
There’s a real snobbery about this. You speak to working-class people about what they think about, for example, the rape gangs from Rochdale or Rotherham, you’d be very surprised by what they said.
It just shows you some of the Tories we took – maybe we shouldn’t have done. The most egregious comment was made by somebody who came to us as a Tory councillor.
This was a reference to Alan Feeney, a councillor in Solihull, who told an undercover reporter that his area had been “infested” with Asian families, and called them “absolute parasites”.
(Farage may have been joking when he made this point. Every party he has led has been accused of attracting a disproportionate number of racists as supporters.)
I accept [that] out of thousands of councillors, there are some people who say stupid things, wanted to say horrible things. But if you apply that equally across the political spectrum, you will find we’re pretty much the same as everybody else.
Farage claims it ‘just isn’t true’ to say people in Reform UK are ‘uniquely awful’
In his Plymouth speech, which has just finished, Nigel Farage has just referred to the ITV News exposé about racism in his party. “In any political party, any group of human beings, any club, there’ll be some [people] that say unpleasant things,” he said.
But he claimed it was wrong to claim there was anything “uniquely awful” about Reform UK.
The sheer level of disproportionality is something I want to share with you very briefly this afternoon.
So, Reform councillors, having been provoked, have said some things we’d rather they hadn’t.
But what about Mr Bonehill-Paine, who was going to be a candidate in Somerset next year for the Conservatives? [He] served a prison sentence for neo-Nazi offences. When it was found out, he then got promoted by Kemi Badenoch to be an adviser to the party.
What about David Graham, the Labour councillor from Fife? He didn’t just say bad things. No, no, no, he sexually abused a 15-year-old girl who he groomed and abused over the course of six months. Have you heard that on the BBC news?
At this point the crowd shouted “no”, and Farage replied: “No, and you won’t.”
(Here is the BBC’s online news report about Graham.)
Farage went on:
And, frankly, the list goes on, a list as long as your arm of assault, of criminality, of paedophilia, of sexual abuse.
Wherever you get thousands of people that congregate together, you will get some bad eggs.
Do not buy in to the media narrative that somehow there’s something uniquely awful about people in Reform. It just isn’t true.
Farage and Badenoch both claim UK at risk of French-style rioting
Nigel Farage, the Reform UK leader, is speaking at the rally in Plymouth
(Not in Portsmouth, as he wrongly said at one point.)
Most of it is familiar Reform UK stuff, but Farage has just included a topical reference – claiming Britain is likely to suffer French-style rioting at some point.
Referring to the “appalling violent mob rule riots that we’ve seen in France over the course of the weekend”, he went on:
Don’t be complacent because it’s the other side of the channel. Don’t think it can’t happen here, because it can.
And I suspect many of those protesting outside this hall today in an effort to stop this meeting from even going ahead would be part of those disturbances if they were to occur. Sadly, I think at some point it will occur.
Farage was speaking after Kemi Badenoch, the Conservative leader, also claimed that the UK was at risk of French-style rioting. But she suggested, if that were to happen in this country, woke policies describing Britain as racist would be to blame.
In an interview with GB News she said:
I do worry that things like [the French riots] could happen here. We’ve already seen protests flaring up across the country. That is why it is very important that we get our economy growing again …
If you tell young people that their country is terrible, that it’s okay to hate their country, that Britain is a racist place, and end up going on about imperialism, white privilege and all of that rubbish, then you see them burning down churches and spraying graffiti on war memorials.
And that’s why I always intervene. You know, some people will say, ‘Why are you getting involved in culture wars?’
I will fight for British culture. It’s very important.
Former Bank of England chief economist Andy Haldane says Tory growth policies ‘far more likely to succeed’ than Labour’s
At one point in the summer Andy Haldane, the former chief economist at the Bank of England, was informally advising Andy Burnham. Haldane spent most of his career as an official at the Bank. He is not a party political figure. But at the Bank he was viewed as an independent thinker, he was brought up in the north of England and he is committed to regional growth (which is one reason why Michael Gove hired him as a levelling up adviser).
But any suggestions that Haldane is a Burnham supporter have now been quashed by an article Haldane has published in the Financial Times. In it, he says the Conservaties’ economic policies are “far more likely to succeed” than Labour’s.
He says:
In the decade since Brexit, both parties have swung simultaneously right on social policy and left on economic policy. The interventionist economic agendas of Conservative prime ministers Theresa May, Boris Johnson and Rishi Sunak would not have been out of place under New Labour. At the 2024 general election, only a vape wrapper separated the parties’ economic manifestos.
Today, those differences are stark. Andy Burnham’s conference speech was a homage to 1950s-style state socialism. Kemi Badenoch’s speech was also a throwback, but to the smaller state and lower taxes of the 1980s. Which offers the more likely path to growth?
In today’s straitened circumstances, the rightward fork is far more likely to succeed.
Haldane argues the Tories have not always been right. He says George Osborne’s austerity policies were a mistake.
At the time of austerity, UK government debt was not only far smaller than it is today, but the cost of servicing it was lower than at any time in human history. Remarkably, the country’s long-term borrowing costs were negative in inflation-adjusted terms for protracted periods. There will probably never have been a better time for public investment.
Yet funding was cut and a £2tn investment gap opened up relative to international competitors, stunting growth. Veering right was wrong.
But, in the current circumstances, Conservative policies would be best for growth, he says.
Today’s fiscal environment is fundamentally different. Long-term borrowing costs have risen 4-5 percentage points and now sit above estimates of the UK economy’s long-term nominal growth rate. That signals the need for primary fiscal surpluses, on a sustained basis, if the UK’s debt dynamics are to stabilise.
The Labour party’s plan for an expansive (and expensive) state sits uncomfortably with this precarious fiscal backdrop. It also sits oddly with the fact that public-sector productivity has failed to rise this century. Both state financial capacity and personnel capability are at present sources of economic weakness, not strength.
In this debt-laden environment, the pursuit of a larger state is more likely to crowd out than crowd in growth. It also runs the risk of a loss of confidence in bond markets that causes borrowing costs to ratchet — think “Liz Truss-plus” …
The Conservatives’ economic plans are better suited to that task: for example, through cuts to business and employment taxes and regulation to unleash animal spirits; and by slimming government spending to lower borrowing costs, as the IMF and Bank of England have recently highlighted.
Danny Kruger tells Reform UK rally media ‘trying to stop us winning’
In Plymouth, the Reform UK rally is just getting under way. Danny Kruger is the first person to speak. He starts by saying that the party has been going through some “turbulence” recently, referring to the ITV undercover exposé (summarised here and here). ITV News found some “rotten apples”, he says, and they have to go.
But he says the journalists behind the investigation are not trying to help. They are “trying to stop us winning”, he says. He goes on:
I’m not here to whine about the media because we’re not the real victims. We’re not the real targets. It’s not us they’re trying to stop. It’s the British people …
It’s not who we are that they hate. It’s what we want to do. We want to take our country back for the people of our country. And they know it. And that’s why they hate us.
Tell us what you think about Covid inquiry’s adult social care report
We would like to hear from readers about what they think of today’s Covid inquiry report into what happened in care homes during the pandemic. You can submit a contribution here.
Inquiry report shows Hancock’s claim about protecting care homes ‘a cruel lie’, Covid victims’ campaign group says
The Covid-19 Bereaved Families for Justice group has issued a statement about today’s inquiry report saying it shows that Matt Hancock’s claim about a protective ring being thrown around care homes (see 12.22pm) was a “cruel lie”.
The organisation said:
Today’s report is a devastating account of one of the darkest episodes in our country’s history. It shows that the government knew the care sector was extremely vulnerable to a pandemic and yet did nothing. Failing to act until it was too late. And It shows that Matt Hancock’s claim to have thrown a protective ring around care homes was a cruel lie. Months before telling us that lie, Matt Hancock sat in a room with Boris Johnson and Simon Stevens and made the decision to discharge hospital patients into care homes, without testing. Three men, with no medical expertise between them, made a decision that became a death sentence for our family members.
The most at-risk people in our society, the sick, elderly – many of whom had a full and long life ahead of them – were failed by a government who abandoned them and left them to die. That is the consequence of social care system treated as a second-class service – too difficult for politicians to reform, too easy to ignore. Our family members paid the price. That is why social care reform cannot wait.
UK to deploy fighter jets to protect Saudi Arabia from Houthi attacks
RAF Typhoon fighters are to be used in efforts to protect Saudi Arabia from attack by Yemen’s Houthis, flying defensive missions over the country’s cities and critical infrastructure as western allies increase their intervention in the escalating conflict. Dan Sabbagh has the story.
Healey accused of missing ‘open goal’ after he rules out raising capital gains tax in budget
John Healey, the chancellor, has been accused of missing an open goal. The claim came from Tax Justice UK, which issued this statement, from its deputy director Caitlin Boswell, in response to the news that Healey has ruled out raising capital gains tax in the budget. (See 8.47am.)
Ruling out a pro-worker, pro-fairness and pro-growth tax rise is a missed open goal. It suggests this government is out of step with the large numbers of MPs across Westminster calling for this change, alongside leading economists. Let alone millions of people who are sick and tired of their needs feeling secondary to those of the super-rich.
Asking those with unimaginable wealth to pay just a little bit more would benefit us all – it’s people being able to afford the basics, see a doctor when they need one, or afford a safe place to live. These are some fundamental things that shouldn’t be hard to deliver in one of the richest countries in the world.
Tax Justice UK backs a plan to raise capital gains tax set out by the CenTax thinktank in a report two years ago. This would raise £14bn, according to CenTax (the Centre for the Analysis of Taxation).
And this is how Hallett concluded her statement.
During the pandemic, the action taken by the UK government and devolved administrations to try and protect workers and users of adult social care came too late.
The failures were the direct result of an absence of proper pandemic planning for the adult social care sector.
This underlines why my recommendations in this report must be acted upon now, before the next pandemic strikes.
Hallett says England should follow Scotland, Wales and NI in having ‘invaluable’ register for social care workers
Hallett said one of her recommendations was for a voluntary register of care workers in England.
I am also recommending the introduction of a voluntary register for the social care workforce in England.
The existing registers in Scotland, Wales and Northern Ireland proved invaluable during the pandemic. They allowed governments to identify recently retired professionals who could return to work and to communicate vital guidance directly. England must follow suit.
Hallett says in any future pandemic extra financial support for care workers should be available ‘at the start’
Hallett said care workers felt “overlooked and undervalued” during the pandemic.
At least 1.5 million care workers were providing care during the pandemic. Many suffered burnout as a consequence of extreme stress and exhaustion. Visits by health care workers dramatically reduced, and this placed an even greater burden on care workers who stepped in to provide this care. They put their own lives at risk to show compassion to the dying, leaving a long lasting impact on their own physical and mental health.
Hallett said, in any future pandemic, “financial support to protect care workers from economic hardship must be in place at the start”.
Hallett said DNACPRs were used too often.
I now return to the deeply troubling issue of Do Not Attempt Cardiopulmonary Resuscitation notices, known as DNACPRs. These notices record a medical decision not to attempt CPR in order to try and save a life.
During the pandemic, there were concerns that these notices were improperly imposed on groups of people, such as people with learning disabilities or older people.
I make no apology for repeating what I said in module three, where these concerns were also raised. This should not have happened.
The inquiry has found no evidence of national policies condoning their blanket application. However, the sheer speed of the pandemic meant that discussions about advanced care plans, which record an individual’s preferences for future medical care and can include discussions about DNACPRs, were too often rushed or nonexistent.
