According to extracts from her speech briefed overnight, Kemi Badenoch will argue later that John Healey needs to slash spending in the budget because UK government borrowing costs are too high. She will say:
Britain’s 30-year gilt yields are now above 6% - their highest level since 1998.
That means every pound we borrow is already costing us £2 in less than 12 years.
It is true the wars in Ukraine and Iran are pushing these rates up around the world.
But they are no more Labour’s fault than they were ours when the war in Ukraine started.
However, the UK is paying more to borrow than anyone else in the G7.
The whole argument on defence spending would go away if our interest rates reduced.
She will also argue that the spending reductions included in Labour’s plans for the final years of the decade are not credible.
Last week the IMF praised the government for the work they were doing on reducing Britain’s deficit.
Labour’s deficit reduction plans to meet their fiscal rules are predicated on making huge cuts to the public sector in the final year of the spending period.
I think there will be an election before then and they’ll never have to prove it.
We are not fooled by made-up spending cuts, and neither it would seem are the IFS - who say relying on these projections would be a “work of fiction”.
Labour have increased spending by more than £100bn in just two-and-a-bit years.
They are not suddenly going to find some courage to cut spending in the final year of a parliament right before an election.