London Daily

Focus on the big picture.
Thursday, Jan 22, 2026

A tale of two finance ministers: UK election rivals promise big spending

A tale of two finance ministers: UK election rivals promise big spending

Two men are vying to be Britain’s finance minister. One is a former banker who hangs a portrait of free-markets champion Margaret Thatcher on his office wall, the other is a proud socialist intent on overthrowing capitalism.

On Thursday, Conservative incumbent Sajid Javid and the Labour Party’s would-be finance minister John McDonnell used speeches to argue that the Dec. 12 election is a critical moment for the world’s fifth-largest economy, and that choosing their rival will set Britain on a path to fiscal ruin.

“This election isn’t just about the next 12 months of the Brexit withdrawal agreement, or even about the next five years. It’s about the next 10 years,” said McDonnell.

“It’s about future generations, and the future of our country and, yes, the future of our planet.”

But, set aside the ideological differences and for the first time in over a decade the Conservatives and Labour are fighting an election campaign with a similar promise: borrow, spend big, and pour billions into building roads, schools and hospitals.

Javid, a 49-year-old former Deutsche Bank financier, would rewrite the country’s fiscal rules so he can spend an extra £20 billion per year, raising borrowing for infrastructure to 3% of economic output from its current 1.8%.

That willingness to spend reflects Prime Minister Boris Johnson’s need to broaden his appeal with the electorate and reach those voters who typically vote Labour.

McDonnell, 68, is a lifelong campaigner who is promising to borrow and spend even more - £400 billion over 10 years. He says the fiscal rule should be that interest payments on government borrowing should not exceed 10% of tax revenues.

Their rules are different, but the direction of travel is the same, even if neither candidate wants to admit it.

“The difference between our approach and Labour’s approach is like night and day, there is a huge gulf in difference in our economic approach,” said Javid.

McDonnell said he wanted an “an irreversible shift in the balance of power and wealth in favour of working people”.


RACE TO SPEND

The race to borrow and spend is a far cry from three previous election campaigns this decade, where the Conservatives played heavily on a reputation for fiscal prudence against a backdrop of economic uncertainty, forcing Labour to downplay its inherent willingness to loosen the purse strings.

The early pledges prompted one non-partisan think-tank, the Resolution Foundation, to declare that whoever wins, Britain appeared to be heading back to levels of state spending not seen since the 1970s, before Thatcher’s small-state revolution.

“Both parties’ plans would represent a sharp change in policy, and Labour’s plans are especially ambitious,” said Ben Zaranko, Research Economist at the Institute for Fiscal Studies think-tank.

The shift in the 2019 campaign reflects low borrowing costs, a budget deficit at its lowest share of GDP since the early 2000s, relatively stable economic fundamentals - setting aside the potential disruption of Brexit - and above all, voters’ unwillingness to endure further spending cuts after nine years of austerity by Conservative-led governments.

There has also been a global shift, backed by the IMF, for higher spending.

While Brexit is expected to overshadow the state of the economy in the election debate, campaigning on basics like roads, railways, schools and hospitals is inevitable, and success depends on winning the economic argument.

On Thursday the new backdrop for those debates was set: borrowing and spending is set to rise, the question the voters will have to decide is by how much?

Newsletter

Related Articles

0:00
0:00
Close
Prince William to Make Official Visit to Saudi Arabia in February
Prince Harry Breaks Down in London Court, Says UK Tabloids Have Made Meghan Markle’s Life ‘Absolute Misery’
Malin + Goetz UK Business Enters Administration, All Stores Close
EU and UK Reject Trump’s Greenland-Linked Tariff Threats and Pledge Unified Response
UK Deepfake Crackdown Puts Intense Pressure on Musk’s Grok AI After Surge in Non-Consensual Explicit Images
Prince Harry Becomes Emotional in London Court, Invokes Memory of Princess Diana in Testimony Against UK Tabloids
UK Inflation Rises Unexpectedly but Interest Rate Cuts Still Seen as Likely
AI vs Work: The Battle Over Who Controls the Future of Labor
Buying an Ally’s Territory: Strategic Genius or Geopolitical Breakdown?
AI Everywhere: Power, Money, War, and the Race to Control the Future
Trump vs the World Order: Disruption Genius or Global Arsonist?
Trump vs the World Order: Disruption Genius or Global Arsonist?
Trump vs the World Order: Disruption Genius or Global Arsonist?
Trump vs the World Order: Disruption Genius or Global Arsonist?
Arctic Power Grab: Security Chessboard or Climate Crime Scene?
Starmer Steps Back from Trump’s ‘Board of Peace’ Amid Strained US–UK Relations
Prince Harry’s Lawyer Tells UK Court Daily Mail Was Complicit in Unlawful Privacy Invasions
UK Government Approves China’s ‘Mega Embassy’ in London Amid Debate Over Security and Diplomacy
Trump Cites UK’s Chagos Islands Sovereignty Shift as Justification for Pursuing Greenland Acquisition
UK Government Weighs Australia-Style Social Media Ban for Under-Sixteens Amid Rising Concern Over Online Harm
Trump Aides Say U.S. Has Discussed Offering Asylum to British Jews Amid Growing Antisemitism Concerns
UK Seeks Diplomatic De-escalation with Trump Over Greenland Tariff Threat
Prince Harry Returns to London as High Court Trial Begins Over Alleged Illegal Tabloid Snooping
High-Speed Train Collision in Southern Spain Kills at Least Twenty-One and Injures Scores
Meghan Markle May Return to the U.K. This Summer as Security Review Advances
Trump’s Greenland Tariff Threat Sparks EU Response and Risks Deep Transatlantic Rift
Prince Harry’s High Court Battle With Daily Mail Publisher Begins in London
Trump’s Tariff Escalation Presents Complex Challenges for the UK Economy
UK Prime Minister Starmer Rebukes Trump’s Greenland Tariff Strategy as Transatlantic Tensions Rise
Prince Harry’s Last Press Case in UK Court Signals Potential Turning Point in Media and Royal Relations
OpenAI to Begin Advertising in ChatGPT in Strategic Shift to New Revenue Model
GDP Growth Remains the Most Telling Barometer of Britain’s Economic Health
Prince William and Kate Middleton Stay Away as Prince Harry Visits London Amid Lingering Rift
Britain Braces for Colder Weather and Snow Risk as Temperatures Set to Plunge
Mass Protests Erupt as UK Nears Decision on China’s ‘Mega Embassy’ in London
Prince Harry to Return to UK to Testify in High-Profile Media Trial Against Associated Newspapers
Keir Starmer Rejects Trump’s Greenland Tariff Threat as ‘Completely Wrong’
Trump to hit Europe with 10% tariffs until Greenland deal is agreed
Prince Harry Returns to UK High Court as Final Privacy Trial Against Daily Mail Publisher Begins
Britain Confronts a Billion-Pound Wind Energy Paradox Amid Grid Constraints
The graduate 'jobpocalypse': Entry-level jobs are not shrinking. They are disappearing.
Cybercrime, Inc.: When Crime Becomes an Economy. How the World Accidentally Built a Twenty-Trillion-Dollar Criminal Economy
The Return of the Hands: Why the AI Age Is Rewriting the Meaning of “Real Work”
UK PM Kier Scammer Ridicules Tories With "Kamasutra"
Strategic Restraint, Credible Force, and the Discipline of Power
United Kingdom and Norway Endorse NATO’s ‘Arctic Sentry’ Mission Including Greenland
Woman Claiming to Be Freddie Mercury’s Secret Daughter Dies at Forty-Eight After Rare Cancer Battle
UK Launches First-Ever ‘Town of Culture’ Competition to Celebrate Local Stories and Boost Communities
Planned Sale of Shell and Exxon’s UK Gas Assets to Viaro Energy Collapses Amid Regulatory and Market Hurdles
UK Intensifies Arctic Security Engagement as Trump’s Greenland Rhetoric Fuels Allied Concern
×