Breaking free of fiscal chains

In recent decades, fiscal policy in the UK has delivered the worst of all worlds. Satisfaction with key public services has fallen, taxes are at a record high, and yet levels of debt – and the cost of servicing it – have still shot up. Successive Prime Ministers and Chancellors have failed to face up to the true state of Britain’s public finances. The task now falls to PM-in-waiting Andy Burnham and whoever his Chancellor may be. If they fail to rise to the challenge, the trade-offs on public services, taxes and benefits will get very painful.

How does Andy Burnham’s inheritance compare to his predecessors? What have been the biggest mistakes of fiscal policy in recent decades? Where is the UK’s debt trajectory heading if current tax and spend decisions continue? Is growth the only possible escape route? What kind of policies should the new PM and Chancellor consider to get the public finances on a healthier footing?