The Chancellor has set new fiscal rules allowing the UK Government to borrow up to 3 per cent of GDP in order to invest, while balancing the books on day-to-day funding.
He is adamant that setting a maximum level of borrowing is essential to shoring up confidence in the public finances.
But Labour has pointed to the most recent data from the OECD club of developed economies, showing that the UK has less investment in proportion to the size of its economy than almost any other country, ahead of only Luxembourg and Greece.
Rachel Reeves, Labour’s shadow Chancellor, said the fiscal rules should be changed to remove the public investment cap. She said: “We should be using our recovery to grow our economy.
“Labour’s fiscal rules mean we will have a strong handle on public finances, while our ambitious climate investment pledges means we can invest in boosting businesses, creating jobs, and getting our economy firing on all cylinders.
“The Government’s short-sighted…
