I was watching Alan Johnsons(shadow Chancellor) interview on Andrew Marr this morning. Alan brought up the subject of capital spending. I agree that this is a good idea (as does Cable and Obama).
Capital spending means that we have a lasting asset like for example the Olympic venues, the high speed train link and say the proposed new aircraft carriers. But this of course includes building schools for the future (which is to be replaced which a smaller building program). Capital expensditure provides work and gives the country with a lasting usable asset. It's not employing administration staff for the sake of it. It provides economically viable jobs with something to show for it.
I hope capital expenditure is taken into account in the spending review and I also hope that it's not only Alan Johnson and Labour who put pressure on to ensure there is some capital expenditure.
"There is simply no money left" - Liam Byrne, outgoing Chief Secretary to the Treasury, May 2010
ReplyDeleteTotally agree Darren, and I've been saying it myself for months. For example, spending £2,000 a month on hiring a builder for a capital project provides approximately a 75% return for the government in terms of benefits saved and taxes/duties earned from that person's additional spending/earning ability. Which is why the cuts are so futile if they further the stagnation of the economy.
ReplyDeleteAs for no money - we can borrow at historically low levels, to create a debt that will only be paid off by stimulating the economy and increasing tax revenues to the government. There's always money, it just needs to be spent wisely (unlike, for example, 2005-2008).