Public spending edging out of control, says Rt Hon Ruth Kelly as she joins new Economic Unit

Think Tank Policy Exchange today announced the launch of its new Economic and Social Unit, headed by Connor MacDonald, and joined by the Rt Hon Ruth Kelly as a Senior Fellow.

In her first intervention in her new role, Ms Kelly argues that radical reform is needed if levelling up is to succeed and woeful rates of productivity growth are to be reversed. Ms Kelly also makes the argument for a real devolution of power, raising the possibility that this could be achieved through the full devolution of some taxes, such as business rates – bringing a far greater degree of accountability over how they are spent.

Today, Rt Hon Ruth Kelly commented:

“We have a crisis in our public finances and huge economic challenges ahead.

“As a former Labour Parliamentary Candidate for Bolton West, a Tory marginal situated among the ‘Red Wall’ seats, I cannot imagine a situation in which its constituents or any of those in the neighbouring seats would vote at the next election for a larger state and even higher taxes.

“They didn’t want a Corbyn and McDonnell spending plan then – and they don’t want it now. Yet the Government is presiding over tax burden which is predicted in a few years to reach its highest level since 1949. Vast sums are being spent by the state – but we must do a better job of making sure they are spent wisely. The state needs to become an enabling state, not an overbearing one.

“We should be looking at radical reform to turn the tanker around. Why not have the full devolution of some taxes? We already have mayors firing on all cylinders, why not give them some real fire power.”

Connor MacDonald added:

“For the first time, public expenditure has passed £1 trillion. This is simply not sustainable. Levelling up can’t be a top-down bureaucratic exercise. Instead, we should be giving local leaders more and better tools to focus on promoting growth and encouraging local initiative.”


Notes to Editors

Connor MacDonald has worked on election campaigns in Canada and the UK, including most recently the 2021 Canadian Federal election. He had most recently worked in Parliament for a Conservative MP.

Rt Hon Ruth Kelly served as MP for Bolton West from 1997 until she stood down in 2010. During this period, she served as Secretary of State for Transport, Secretary of State for Communities and Local Government, Secretary of State for Education and Skills and Minister for Women and Equalities, as well as holding ministerial roles in HM Treasury. Since leaving Parliament, she has held roles at HSBC Global Asset Management and St Mary’s University. She is Chair of Thames Freeport.

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