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Economy Economy

Continue to restore the public finances

Last updated: 01:53pm 23 September 2019

There is still work to do on deficit reduction, so we will continue to restore the public finances over the course of the next parliament.

Conservative Party Manifesto 2017, p.13

Our verdict

Public finance is the term used to refer to the finances of the government – how much is coming in (through taxes, bonds, etc), and how much is going out (spending on public services, for example). A key part of public finance is the national deficit, which is when the government is spending more than it earns. It’s also called “net borrowing”.

This policy is essentially a promise to continue with the plans to reduce the deficit announced in the 2016 Autumn Budget, and the subsequent introduction of the Charter for Budget Responsibility.

So far, the national deficit has shrunk since 2017. Compared to GDP (Gross Domestic Product – a monetary measure of a country’s wealth by valuing all final goods and services within the year), it has decreased from 2.3% in 2016/17, to 2.1% in 2017/18, to 1.2% in 2018/19.

So far then, the government looks to be on target. Because the promise is to continue the reduction “over the course of the next parliament” we are marking this as ‘in progress’ and will make a final call when the time comes. Follow this policy for updates.

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