Kemi Badenoch will unveil a “golden rule” to reduce government borrowing through spending cuts as she seeks to rebuild the Conservatives’ reputation for economic credibility.
In a speech at the Tory party conference on Wednesday, she will promise that at least half of all the money saved through spending cuts would be used to bring down the country’s deficit, with the remainder used for tax cuts and other measures aimed at economic growth.
UK government borrowing rose to a five-year high in August, jumping to £83.8bn for the financial year and dealing a blow to Rachel Reeves, the chancellor, as she prepares for the 26 November budget.
Badenoch and her shadow cabinet have already set out plans to cut £47bn of spending on welfare, aid and the civil service but also plan to cut taxes by reversing Labour decisions to levy VAT on private schools and inheritance tax on farms and scrapping business rates for shops and pubs.
In her speech on the final day of the conference in Manchester, she will attempt to portray the Tories as the party of sound economic management – a reputation that was torn to shreds under the leadership of her predecessors such as Liz Truss.
Badenoch will say: “We are the only party with a plan to get our economy back on track. It starts with fiscal responsibility. We have to get the deficit down. And we must also show how every tax cut or spending increase is paid for.
“So today, I am going to introduce a new golden economic rule. Every pound we save will be put to work. At least half will go towards cutting the deficit – because living within our means is our first priority. And with the rest, we are going to get our economy growing again. And bring down the taxes stifling our economy.
“Over the next decade, Rachel Reeves is going to double the deficit with her borrowing and tax doom loop. It’s not sustainable and it’s not fair. It is stealing from our children and grandchildren. And Conservatives will put a stop to it.”
She will also announce that a Conservative government would cap the number of students who could attend “rip off” university courses deemed not worthy of taxpayer support, such as “debt trap” arts degrees. Driving down the number of people who attend university by 100,000 each year would save £3bn in unpaid student loans, allowing funding to be doubled for vocational apprenticeships, Tory sources told The Telegraph.
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Badenoch will say: “We need more apprenticeships. I was working with adults. I was paying my own way. And it gave me self-confidence in a way my university degrees never did. And unlike my subsequent university degree, I wasn’t still paying off my debts in my early 30s.”
A Labour spokesperson said: “Kemi Badenoch has some brass neck. It’s astounding that her latest speech still contains no apology for the Conservatives crashing the economy, which left families saddled with sky-high mortgages and rising prices in the supermarket.”
The party said the Conservatives’ “fantasy” savings had been worked out “on the back of the same fag packet Nigel Farage has been writing on”.
“The Tories are all over the place, it shows they’ve learned nothing and still can’t be trusted with the public finances,” the spokesperson said.
A Liberal Democrat spokesperson said the idea that the public would trust the Conservatives with the economy was “laughable”.
