“This isn’t just about accuracy. It suggests the Chancellor thinks she’s got debt under control. In reality she has put the public finances in a perilous position.”
Shadow Chancellor Sir Mel Stride has written to Chancellor Rachel Reeves demanding she correct a statement made in the House of Commons this week about the trajectory of public debt.
At Treasury Questions on Tuesday, Reeves told MPs: “The Office for Budget Responsibility forecasts that debt is going to fall during the course of this Parliament, something that never happened under the Conservative Government.”
In a letter released today, Stride said the claim was “demonstrably inaccurate” and pointed to official data showing debt as a share of GDP fell in the years before the pandemic. According to the Office for National Statistics, public sector net debt peaked in 2016–17 and then declined until the Covid crisis struck in 2020.
Stride highlighted that the government has also changed the measure of debt it uses for its fiscal rules. The previous Conservative government used public sector net debt excluding the Bank of England (PSND ex BoE), under which the OBR forecasts debt will rise every year of the current Parliament. Reeves has instead adopted public sector net financial liabilities (PSNFL), which the OBR projects to fall slightly in later years.
The Shadow Chancellor stressed that even on PSNFL, debt fell “by substantially more” under the Conservatives prior to the pandemic than is forecast under Labour. He also pointed out that the OBR’s March 2025 forecast showed headroom against the debt-falling rule at just £15.1bn, down from £49.1bn before Reeves’s first Budget decisions.
Stride warned that those forecasts included savings from changes to Winter Fuel Payments and disability benefits which ministers have since abandoned, meaning the true debt outlook is worse than reported.
Writing on X, Stride said: “This isn’t just about accuracy. It suggests the Chancellor thinks she’s got debt under control. In reality she has put the public finances in a perilous position.”
The letter has been copied to Commons Speaker Sir Lindsay Hoyle, with Stride formally asking Reeves to correct the parliamentary record.
The Treasury has not yet issued a response.
Main Image: Rt Hon Mel Stride MP. Picture by Rory Arnold / No 10 Downing Street. Image licensed under the Creative Commons Attribution 2.0 Generic license. Image of Rachel Reeves for illustration purposes only. Image created with AI.
FANTASTIC NEWS! The Times this morning – PRESIDENT TRUMP VISIT TO BRING BILLIONS IN TECH INVESTMENT. (Craig Hamilton Parker was right, America will do a massive trade deal and brexit is officially declared a success!) )
The brexit war is the largest betrayal of our democracy. We had a vote on EU membership in 2016 and the leave vote wasn’t respected by the EU and many M.P’s.