If you consider that the public sector borrowing requirement for 1993-94, forecast by the Treasury in November 1992 at pounds 44bn, represents 7 per cent of GDP, then the Maastricht formula would require a spending cut of pounds 25bn. Since this would worsen the economic situation still further, and reduce demand for goods and services causing cutbacks in company investment, resulting in rising unemployment, the gap between the 3 per cent desired spending limit and the reality would widen.
Local government 'financial control' on a national scale? Perhaps we need to worry about more than disappearing prawn cocktail crisps and the great British banger.
Preston, LancsReuse content