The Chancellor will publish updated public borrowing forecasts in line with the code for fiscal stability in this autumn’s pre-Budget report in the usual way.
The right hon. Lady will be well aware that the European Union’s Commissioner for Economic and Financial Affairs has already said that the deficit needs to be corrected by 2009-10. Does she accept that deadline and, if so, how on earth is she going to achieve it?
In fact, the IMF has supported our policy position in a strongly supportive document. The EU has different arrangements as it operates within the eurozone, which we do not, so we have different obligations on fiscal policy. We have chosen to use borrowing to support the economy through a difficult time. That is the right thing to do and constrasts significantly with the continued mistakes made by the hon. Gentleman’s party in the early ’90s.
Is it true to say that present forecasts put Britain in a situation where we have lower net borrowing than we did throughout most of the ’90s? What is my right hon. Friend’s forecast for our performance in comparison with other European countries for the forthcoming period?
My hon. Friend is right to say that there are significant contrasts, particularly in respect of historical periods. Between 1997 and 2007, average borrowing was 1.2 per cent. of gross domestic product; whereas between 1992 and 1997 it was 6 per cent.; and between 1979 and 1997, it was 3.4 per cent. of GDP. Borrowing has been significantly lower and continues to be substantially lower than at the peak of borrowing in 1992, which was 7.5 per cent—a substantially higher rate than it is today.