Senior Treasury minister falters over questions on rising debt

A senior Treasury minister appeared to struggle with questions on the rise in debt as a share of GDP as she defended the Government’s tax-cutting ambitions.

Laura Trott said she had “different figures” when she was presented with the latest official projections from the fiscal watchdog, which suggest an increase over the next five years.

Appearing on BBC Radio 4’s PM programme, the Chief Secretary to the Treasury was challenged after claiming debt was falling as a share of GDP.

The Office for Budget Responsibility said in November that debt excluding the Bank of England is forecast to climb as a percentage of national income from 89% in 2023/24 to 92.8% in 2028/29.

Ms Trott had faced questions about hints from senior Tory figures over recent months of a possible pre-election giveaway in the spring Budget.

Asked why the Government was discussing tax cuts while one of Rishi Sunak’s five key priorities, reducing debt, was not being met, she said: “The central pledge is one of our fiscal rules which is that that needs to be falling over the five-year fiscal forecast as a percentage of GDP, which it is.”

Presenter Evan Davis interjected, telling her it is set to be “higher in five years than now” and pointing to the latest projections.

After a pause, Ms Trott appeared to start saying “I’m not sure”, to which Davis replied: “This is really basic… I’m amazed that you don’t know that debt is rising.”

The minister said: “I think I need to have the figures. I’ve got different figures which… I think we just need to… yeah.”

She did not specify which figures she meant.

There are different measures of debt – public sector net debt (PSND) and public sector net debt excluding the Bank of England, the latter being the figure usually used by the Government.

PSND is forecast to drop by around 4% as a share of GDP over the next five years, but underlying debt – excluding the Bank of England – is set to rise by around 4% in the same period.

Earlier in the programme Ms Trott had attacked Labour over its now-abandoned pledge to spend £28 billion a year on green projects, which the Conservatives have used to accuse the Opposition of having a weak grasp of the public finances.

Responding to Sir Keir Starmer’s announcement, in which he said the spending pledge would be have to be scaled back if Labour wins power due to the Tories having presided over a “very broken economy”, she said: “I mean, it is extraordinary. If you just look at this one thing, this is their key economic policy and they can’t even agree on this… Rachel Reeves has not been able to say the £28 billion.

“Literally two days ago, I think, Keir Starmer was saying it’s absolutely necessary… so this has just been a total mess, the likes of which I don’t think we’ve seen for a number of years.”

Labour said it was “terrifying” that people unaware of “the basic facts” are in charge of the country’s finances.

Ms Trott’s opposite number, Darren Jones, said: “The Tories have crashed the economy and doubled the national debt over the last decade. This evening we discover that Laura Trott, Jeremy Hunt’s number two, doesn’t even know the basic facts of her job.

“It’s terrifying to think these people are not just in charge of the country’s finances but still think they can lecture anyone else.”