Pre-Budget Report

No, indeed. In fact, the full answer from the Governor of the Bank of England on this question paints a very different picture. He gave his answer in evidence to the Treasury Select Committee, saying:""It is certainly true that if you eliminate the deficit too aggressively it will have an adverse consequence."" He went on to say:""You have to take action to bring down the deficit of the size we have—it is a very large structural deficit—but to do so at a rate that is consistent with the restoration of growth in the economy"." That is why we propose to reduce the structural deficit from 9 per cent. to 3.6 per cent. in the space of just one Parliament. Is our deficit reduction plan fast enough for the ratings agencies? Again, their views are sometimes traduced in this House, but the reality is that in Moody's analysis published last month, both the US and the UK triple A ratings are described as "resilient"; all three rating agencies have acknowledged the UK has access to particularly deep and liquid capital markets; and on perhaps the ultimate test of demand, gilt auction performance remains strong. Ten-year gilt yields averaged over 11 per cent. in the 1980s; they are now around 4 per cent. I hope that all these arguments and more are debated this afternoon. If I were forced to characterise this pre-Budget report, I would say that the sweep of its ambition is matched by the depth of its detail. In the debates that we have had—not only in this place, but in the media and elsewhere, and particularly in the debates the hon. Member for Runnymede and Weybridge and I have had late at night in TV studios around London since 9 December—I am sure that you, Mr. Deputy Speaker, will have been struck like me by the sheer contrast between 212 pages of detail on specific, pressure-tested proposals and the vacuous nonsense of the Conservative party.