Boris Johnson says he would increase borrowing to fund ‘certain great objectives’

Tory leadership frontrunner opens door to raising debt to pay for ‘great infrastructure projects’, as rival admits no-deal Brexit would affect his own spending pledges

Boris Johnson has said he would be happy to increase borrowing to fund his spending pledges if he becomes prime minister.

The Tory leadership frontrunner said he would borrow money to fund “great infrastructure projects”, including his promise to bring forward the rollout of super-fast broadband.

As the two candidates to succeed Theresa May faced scrutiny over their spending plans, Jeremy Hunt admitted he would have to delay some of his pledges if there is a no-deal Brexit.

Mr Johnson said he would spend the money set aside to help the country cope with a possible no-deal outcome, and would cut taxes in an attempt to boost economic growth.

He told Sky News’s Sophy Ridge on Sunday: “What is certainly true is at the moment there is cash available. There’s headroom of about £22bn to £25bn at the moment.”

Asked if he would also increase borrowing to fund his plans, he said: “If it’s borrowing to finance great infrastructure projects, and there’s the opportunity to borrow at low rates, to do things for the long-term benefit of the country, then we should do them.”

He added: “I’m prepared to borrow to finance certain great objectives, but overall we will keep fiscal responsibility, and keep going with the general trajectory of ensuring that this country pays its way and lives within its means. But you can do that with some sensible tax cuts that will stimulate growth, stimulate enterprise, get more enterprise in.”

Mr Hunt insisted that his spending plans could be funded through the “war chest” set aside for a no-deal Brexit. This would be used to pay for pledges including a cut to corporation tax and a £15bn increase in defence spending, he said.

The foreign secretary told the BBC’s Andrew Marr Show: “There is £26bn of room which the chancellor has built up as a war chest. It is true that if you don’t spend that money, you could use it to reduce borrowing, but I want to do something different.

“What I’m saying is spend that money wisely – spend it in a way that increases the growth of the economy, that creates more opportunities for young people, that turbo-charges what could be the most dynamic, pro-business, pro-enterprise country in Europe, and then you create the wealth for all those other things.”

He compared his plan to that of Donald Trump, praising the growth of the US economy under the current president

He said: “If we could do what President Trump has done in America, which is stimulate the economy, we could boost our growth rate to American levels of 3 per cent plus.”

This rate of growth would create an additional £20bn for spending on public services, he said.

Mr Hunt admitted that some of his spending pledges “would have to wait” if there was a no-deal Brexit, because the money would be needed to help businesses cope with the impact.

He said: “I wouldn’t drop [the plans] because I think we can make a success of no deal. They would take longer because you wouldn’t have that money at your fingertips straight away.”

“Of those commitments, the one I would not drop is the one to reduce corporation tax. It’s not the tax cut people are talking about on the doorstep when you meet them but it is one that would fire up the economy in a way that would be helpful in a no-deal context because we would have economic bumpiness and we need to support businesses.”