The Times: Liz Truss gives support for John Person’s “economic freedom has to mean fiscal discipline” ideas

Liz Truss shared the article [by John Penrose MP] calling for the government to be forced to keep to its “day-to-day budget” balanced.

A senior minister has endorsed a proposal to let members of the public sue the government for spending too much.

Liz Truss, chief secretary to the Treasury, approvingly shared an article by a fellow Conservative MP calling for a new “fiscal rule” to be written into law, binding the government to keep its “day-to-day budget” balanced. Under the plan, the government would only be allowed to borrow to fund capital investment in infrastructure but not for spending on public services.

The idea was proposed by the WestonsuperMare MP John Penrose, a former minister, in an article for the ConservativeHome website. Ms Truss posted it to her 44,000 Twitter followers yesterday, adding: “Great piece by @JohnPenroseNews. Economic freedom has to mean fiscal discipline.”

As Philip Hammond’s de facto deputy, Ms Truss is responsible for public expenditure and spending control.

Mr Penrose wrote that under his rule “governments would still be able to borrow for long-term investments in economic infrastructure such as fibre optics, roads or rail. But everything else, the day-to-day spending on things like health, schools, police or defence, has to be paid through your and my taxes.”

He added: “The power of a fiscal rule is that it forces governments to make sure we only live within our means. If they don’t, then citizens can take ministers to court, and the figures are independently audited to make sure they can’t be fiddled.

“This matters, because it would mean an end to boom and bust, for the government’s finances at least. We would have stronger, more predictable, stable foundations for wealth-creating investments in new jobs and technologies. Public spending on things like health, schools, police or defence could increase steadily, rather than in stop-go cycles. And we’d pack a stronger punch internationally too.”

Mr Penrose praised Ms Truss in the article, writing that she “backed the idea of a fiscal rule” in a speech at the London School of Economics in June.

Ms Truss used the speech to praise Switzerland and Chile, which she said had “shown that flexible yet robust fiscal rules can be designed which balance budgets over the business cycle … These rules are self-discipline mechanisms, which help ensure that governments do not get carried away”.

The speech made waves for her jibes at colleagues including Michael Gove. Ms Truss, who has reinvented herself as a modern low-tax libertarian since being demoted from lord chancellor last year, criticised Mr Gove’s actions against wood-burning stoves, joking: “There’s enough hot air and smoke at the environment department already.” She argued that some regulations “get in the way of consumers making legitimate choices”.

This article was written by Henry Zeffman, Political Correspondent at The Times.

(2) Comments

  1. Mr Neville Peter Arnold

    Hi,. too little too late as far as I am concerned and not workable in todays political turmoil.
    Having been a floating voter all of my previous voting life, (now 79 years old) I have been voting Conservative since Tony Blair made Old Labour into New Labour, but drastic times need drastic measures, for myself. and I am now, (for the first time) a paid up member of a political party, namely, UKIP.
    I have no faith in the old Lib/Lab/Tory mainstream, they are all pro EU for sure; whatever lies they may pump out to us, the voting public.
    The MSM are hand in hand with them, thank God for the internet, so we, the public, can be better informed.
    Nothing to do with download/upload speeds I know, ( mine is ok ), by the way.
    The UK, like the EU, needs to have a major re-think, but it is the UK that is my main priority. today.
    I love my country (England) and have served in the armed forces (RN) and get no pension by the way, as thanks…we that served between 1947 and 1975 were swindled by different government scheming.
    Back to the subject in question (Fiscal Discipline) with the number of illegal immigrants that are now in our country, I suppose the thinkers behind the scheme, presumed that they will all be working and contributing lol…what planet are they from.
    It is about time parliament faced up to facts, there are too many immigrants here, (legal or illegal), us taxpayers cannot carry them any longer we are being screwed too hard.
    Thank God I bought a private pension during my working life, although it is not a fortune it keeps the wolf from the door.
    My city of birth, Birmingham, is now strewn with no go areas full of large families, that have very few members working in full time employment…if at all; so no use looking there for income, by tax means, rather a drain on taxes; making this “fiscal discipline” pipe dream, unworkable,at all levels
    Sorry, your party has let the country down, big time…time for change.

    Reply
  2. An absolutely brilliant idea, one that should be at the heart of all Government.

    However, and there’s always a ‘however’. In British Law, a future Government can repeal a previous law, So what is to stop this law (if it becomes one) being repealed and a future Government borrowing us into debt again?

    Reply

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