Hammond dismisses Javid call for additional borrowing
The chancellor has slapped down Sajid Javid’s suggestion that the government could borrow to fund a new building drive for housing and infrastructure.
In a BBC interview on Sunday, Mr Javid said borrowing to invest in housing and infrastructure “can be the right thing if done sensibly”.
But in the House of Commons today, Philip Hammond recommitted to reducing the deficit and apparently ruled out increased borrowing.
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The chancellor was challenged by Conservative backbencher James Cartlidge to confirm he would not pay for measures in next month’s budget by “billing our grandchildren”.
Mr Hammond replied: “It is not responsible to make so-called hard choices by loading the price onto the next generation and the generation after that.
“We have to make the difficult decisions and we have to bear the consequences of those decisions and at £65,000 per household our public debt in this country is still far too high, so I can confirm to him that we will continue with the plans that we have announced to reduce the deficit in a measured and balanced way to ensure that debt is falling as a share of GDP.”
The response will pour cold water on a positive response to Mr Javid’s comments from the sector, which had appeared to signal a change in approach for the government.
Theresa May recently called a summit of housing experts at Number 10, as the government seeks solutions to the housing crisis ahead of the Autumn Budget.
On Sunday, Mr Javid told The Andrew Marr Show: “What I want to do is make sure that we are using everything we have available to deal with this housing crisis, and where that means we can, for example, sensibly borrow more to invest in the infrastructure that leads to more housing and take advantage of some of the record low interest rates we have, I think we should absolutely consider that.”
The government is known to be considering bespoke deals with councils, which may see them given additional borrowing powers to build housing.