Andy Burnham warned against extra borrowing as bond markets raise alarms

Financial experts and former chancellors have cautioned Andy Burnham that a proposal to raise up to £9 billion a year in extra borrowing could be rejected by bond markets. They likened the plan to “a credit card paid for by the taxpayers of tomorrow”. The Treasury is reportedly preparing a growth‑boosting strategy that would use additional borrowing, potentially permitted under former chancellor Rachel Reeves’ fiscal rules if the funds are directed to infrastructure, housing and business support.

Critics, including former Conservative chancellor Phillip Hammond, the Adam Smith Institute’s James Hodgkinson, and the Institute for Fiscal Studies, warned that such borrowing would increase the cost of UK debt, raise the national debt ratio and could lead to higher interest payments. Burnham faces pressure to revive Britain’s sluggish growth ahead of the next budget, while also addressing cost‑of‑living pressures and the impact of the Iran war on the economy.