London Daily

Focus on the big picture.
Friday, Jun 19, 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
Payment Fraud Losses Reach £1.28 Billion and Raise National Security Concerns
Lending to Small Businesses Climbs to Highest Level Since Late 2024
Middle East Conflict Clouds UK Economic Recovery Despite Strong First-Quarter Growth
Bank of England Moves to Simplify Capital Rules for Smaller Lenders
UK Government Fast-Tracks National Security and Cyber Resilience Legislation
Ofcom Investigates Telegram Over Alleged Role in Organising Arson Attacks
MPs Press Fujitsu to Speed Compensation for Post Office Horizon Victims
Bank of England Delays Final Basel III Implementation Changes to Support UK Banking Competitiveness
Pound Falls as Political Uncertainty and Bank of England Signals Weigh on Markets
0Andy Burnham Wins Makerfield By-Election and Emerges as Main Challenger to Keir Starmer
Dorset Council Tests AI Tools to Streamline Local Planning Applications
UK Researchers at Kew Gardens Use AI to Speed Up Identification of Threatened Plant Species
UK Gilt Yields Ease Toward 4.8% as Inflation and Labour Market Data Weigh on Bonds
Bank of England Data Shows Resilient SME Lending Despite Economic Slowdown
UK Finance Reports Weakening Services Activity as Business Confidence Softens
UK Introduces Mandatory Internal Complaints Process Under Data Use and Access Act
Bank of England Governor Andrew Bailey Flags Geopolitical Uncertainty as Key Risk to Inflation Outlook
Bank of England Holds Interest Rates at 3.75% as Policymakers Signal Cautious Stance on Inflation Risks
Cornwall Clergy Raise £40,000 for Church Repairs Through Everest-Themed Charity Challenge
UK Business and Social Landscape Reflects Strain From Geopolitical and Domestic Pressures
Tensions Grow in UK Over Sikh Kirpan and Religious Symbolism in Public Debate
Energy Price Cap Increase Set to Lift UK Household Bills by 13 Percent
University of Reading Ranked 196th in QS World University Rankings
UK Maritime Archaeologists Identify 17th-Century Dutch Shipwreck Off Devon Coast
Oxford Union Islam Debate Sparks Protest From Faith Leaders in UK
UK Social Cohesion Debate Intensifies After Religious Prejudice Survey Findings
UK SME Lending Rises Despite Geopolitical Uncertainty and Cautious Outlook
Foreign Demand for UK Gilts Remains Sensitive to Global Inflation Trends
Labour Party Faces Leadership Pressure After Weak Local Election Results in UK
Transport Costs Drive Inflation Pressure as Petrol Prices Push Up UK CPI
British Chambers of Commerce Cuts Growth Forecast as Middle East Conflict Weighs on Investment
UK Economy Grows 0.6 Percent in First Quarter but Outlook Remains Weak
Bank of England Holds Interest Rates at 3.75 Percent as Inflation Risks Persist
Energy Price Cap Rise Expected to Keep UK Inflation Above Target Through 2026
Health Authorities Warn of Rising Cases of Seasonal Respiratory Illnesses
BAE Systems and Rolls-Royce Advance Multi-Nation Fighter Aircraft Programme
National Archives Publish Declassified Documents on Cold War Energy Security Planning
British Retail Spending Rises Despite Continuing Cost-of-Living Pressures
Wales Launches Social Housing Pilot to Address Affordability Pressures
British Energy Companies Commit £5 Billion to Geothermal and Hydrogen Projects
Northern Ireland Debates Cross-Border Healthcare Partnership With the Republic of Ireland
UK Establishes National Artificial Intelligence Safety Centre With Leading Universities
UK Reports Decline in Small Boat Crossings After Expanding Intelligence Cooperation With France
Scottish Parliament Launches Inquiry Into Delays to Renewable Energy Projects
National Crime Agency Dismantles Alleged Multi-Million-Pound Money Laundering Network in London
Transport Strikes Disrupt Rail and Bus Services Across Northern England
United Kingdom and European Union Open New Security Dialogue on Defense and Border Cooperation
Bank of England Holds Interest Rates at 5% as Services Inflation Remains Elevated
UK Government Unveils Major National Health Service Reform Focused on Decentralization and Performance Funding
Government Advances New Airport Slot Rules to Ease Airline Operating Constraints
×