By Matthew Barrett
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In a Parliamentary Question released on Thursday, the official Treasury estimate of the cost of Labour's five-point economic plan was given - it totalled more than £20 billion, which would be added to the budget deficit.
Michael Meacher, the veteran left-wing Labour MP, asked:
"To ask the Chancellor of the Exchequer pursuant to the contribution by the Chancellor of the Exchequer of 12 October 2011, Official Report, columns 366-82, what evidence he considered in concluding that adoption of the five-point plan would (a) increase the deficit by £27 billion and (b) raise interest rates by one per cent."
- Reducing the rate of VAT for a year "would increase the deficit by around £12.4 billion."
- A temporary reduction in VAT on home improvements would increase the deficit by £2.2bn
- A temporary reduction in employer national insurance contributions for small businesses taking on extra workers is estimated to increase the deficit by around £1bn
- "The cost of bringing forward capital spending would depend on the specific proposal. The estimate given in the debate reflected an illustrative assumption that the policy would imply no real terms cuts in capital departmental expenditure limits in 2011-12. If this were the case, the increase in the deficit would be £5.5 billion"