Former Burnham adviser backs Tory plan for the economy
Former Burnham adviser backs Tory plan for the economy
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Emma TaggartTue, October 20, 2026 at 11:09 AM UTC
Andy Haldane is a former chief economist at the Bank of England - Anadolu/Thomas Krych
A former adviser to Andy Burnham has backed the Conservative Party’s plan for the economy, saying it is “better suited” to addressing Britain’s problems.
Andy Haldane said Kemi Badenoch’s pledge to deliver a smaller state and lower taxes offered a more likely path to growth compared with plans for an increase in public spending under Mr Burnham.
The diagnosis is stark given that Mr Haldane advised the Prime Minister informally on economic policy on his ascent to No 10. The former chief economist at the Bank of England declined a formal role in Mr Burnham’s Government.
Writing in the Financial Times, Mr Haldane said: “The Labour Party’s plan for an expansive (and expensive) state sits uncomfortably with this precarious fiscal backdrop.”
He added that “the Conservatives’ economic plans are better suited” to boosting growth “through cuts to business and employment taxes and regulation to unleash animal spirits; and by slimming government spending to lower borrowing costs”.
Mr Haldane, who is now president of the British Chambers of Commerce, said that as governments grapple with rising inflation, sluggish growth and higher borrowing costs, “the Rightward fork is far more likely to succeed”.
He said Mr Burnham’s conference speech last month was “a homage to 1950s-style state socialism”, and said Labour’s plans for a larger state could hold back growth.
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Mr Haldane added: “It also runs the risk of a loss of confidence in bond markets that causes borrowing costs to ratchet – think ‘Liz Truss-plus’.”
Ms Truss’s 2022 mini-Budget contained unfunded tax cuts that spooked bond markets and caused an extremely sharp rise in Britain’s borrowing costs.
Mr Haldane wrote: “The route to growth comes from priming the private sector, not pump-priming the public sector.”
The intervention comes amid speculation that John Healey will announce tax rises on banks and family businesses at his maiden Budget next week.
Borrowing costs have risen sharply in the run up to the fiscal event, adding to the interest bill the Government must pay on Britain’s rising debt and denting the financial space that Mr Healey has to fund the Prime Minister’s spending plans.
Economists have estimated that the Iran war has halved Mr Healey’s spending buffer, known as fiscal headroom, to just £12bn.
In a speech on Tuesday, Mrs Badenoch urged the Chancellor to rein in spending in his upcoming Budget, calling on Labour to “stop borrowing so much”.
She said “cuts are never easy” but added that the Conservative Party had found £70bn in savings that it would implement if elected to shore up Britain’s public finances.
Source: “AOL Money”
