00:00The Shadow Chancellor, Mel Stride, who joins us now from central London.
00:05Mel, good morning to you. Big morning, things happening fast.
00:09Just got those inflation figures, don't know if you've heard them, up gentle rise of 0.2%.
00:15So inflation very slow, gives us an overall total of 3.6.
00:21What's your take on that?
00:24Well, it's too high, Eamon, and the reason it's too high,
00:27and remember it was about half that under the last government,
00:31we got it down to about 2%, well, bang on 2%,
00:33is that the government's been out there borrowing and spending vast amounts of money,
00:37and that has been stoking inflation.
00:39And, of course, what that means is interest rates being higher for longer,
00:43which is obviously going to be felt through people's mortgages, business, borrowing costs,
00:47and also the servicing costs of our national debt that this government is ever adding to,
00:52which is running at about £100 billion a year, which is twice what we spend on defence.
00:56So the wrong economic decisions leading to higher inflation, I'm afraid.
01:01Listening to the Chancellor's speech at the Manchin House last night,
01:06she was basically saying, let's do away with this cautiousness, let's be bold,
01:11let's get out there, let's be more strident with lending rules, not as hemmed in by them.
01:18Yeah, I think there's something to be said for that.
01:23I think there has been a kind of excessively cautious culture amongst some of the regulators,
01:30and we need to get back to the basics of regulation not getting in the way of growth
01:35and making sure regulators do whatever they can to facilitate growth,
01:40as well, of course, of protecting the financial system and consumers as well.
01:44But we need to get that balance right.
01:46But what I would say with the Chancellor is it's all very well to stand up in the Manchin House
01:50and say that, whilst at the same time, of course, she's put us in a position
01:54where we now have very poor and weak public finances,
01:59and we've got a summer of absolute uncertainty approaching this coming budget
02:04as to whether taxes are going to be going up, and I think we all know that they will be,
02:08and who's going to be paying the bill.
02:10That is not an environment in which growth occurs, I'm afraid.
02:14Well, they would argue that you left them a £22 billion black hole,
02:17that I think they've actually made bigger.
02:20But they would argue that, and some of these measures have to be put in place.
02:25So that's kind of why she's doing the thing.
02:27For example, the national insurance hike on employers.
02:30Well, no, no, no, I disagree with that.
02:35The £22 billion black hole, the Office for Budget Responsibility,
02:39that's the independent forecaster, has completely debunked that number.
02:44It's just completely erroneous.
02:47The only black hole that has actually been created is the one that this government created
02:51when it stripped out all the savings from welfare that it was trying to get through the Commons.
02:56That was a £5 billion cost there, and the U-turn that they did on the winter fuel means testing.
03:03That means they are sitting there with a £6 billion black hole as they go into the budget in the autumn.
03:08And this is one of the factors, as well as mismanaging the economy so we've got low growth,
03:13that are going to lead to those tax increases in the autumn.
03:16And that, of course, is going to weigh still further on consumers
03:20and hard-pressed people up and down the country, and businesses as well.
03:23Mel, could I draw your attention to this big story today about the migrant, the Afghan migrant cover-up?
03:33You know, we talk about costs and spending, and this could cost the country £7 billion.
03:39And the embargo was put under your government?
03:41Well, so we don't actually know the kind of figures here.
03:47I mean, there are all sorts of numbers, everything for about £800 million upwards.
03:50But, look, I think the principle here is an important one, and that is that when this data was leaked,
03:55which was a terrible error on the part of the Ministry of Defence and should never, ever happen again.
04:01It's extraordinary. It happened in the first place.
04:03But it did place at risk tens of thousands of Afghans who had, in many cases, bravely assisted us
04:09when we were involved in Afghanistan and whose lives would be put in danger as a consequence of this data being out there.
04:16And that's why this super injunction was brought in. It was continued by the current government as well.
04:22And I think, in principle, that was the right approach.
04:25But, of course, there will be many questions, quite rightly now, around this,
04:28and that's where Parliament will now play a full part, including the Defence Select Committee,
04:33which no doubt will be launching an inquiry fairly shortly, I would have thought.
04:36Do you think it was right to lift the super injunction?
04:41Well, those are judgments to be taken by the government.
04:46They did have a review from a former deputy head of our security services
04:52into what the current situation is, the risk and so on.
04:57And they clearly came to the decision that now was the time to remove that.
05:01I don't know the details around that particular judgment,
05:04but clearly that would have been looked at very carefully.
05:07I was going to ask you, though, back to the economy.
05:09If you were in power now, what would you be doing differently to Rachel Reeves?
05:15Gosh. Well, no, no, that is an extraordinary question.
05:18That is a great question.
05:20I think it's like saying, though, look, if somebody's driven a car into a brick wall at 100 miles an hour,
05:24look, Mel, take the steering wheel and tell us how you'll get out of that.
05:28I wouldn't have got where we are in the first place.
05:30And there are three principal things I would have done differently.
05:33One is on the tax and spending side, I would not have been borrowing vast sums of money
05:38and I would certainly not have been taxing business
05:40because that's part of the reason why economic growth has been very, very anemic.
05:45Secondly, on productivity, that's output per worker.
05:48I wouldn't have been going in and giving 14% pay rises to train drivers,
05:5222% to the junior doctors with no strings attached,
05:55no requirement for greater efficiencies.
05:57And the third thing is welfare.
05:59We had shown in government that we can make serious savings from the welfare bill,
06:03£5 billion due to reforms that I put through.
06:05We had further plans to bring the welfare bill back under control.
06:10And if they had done those three things,
06:13we would be in a very different position now.
06:15Shadow Chancellor, thank you for your time this morning.
06:18Always appreciated. Good to talk to you.
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