Tuesday, April 21, 2009

Do you remember Gordon’s ‘Prudence’?

At the start of the Labour government in 1997, Gordon Brown promised us prudence in public finance. Prudence, of course, was dumped.

A publication by the National University of Singapore shows that using sensible forecasts of growth – not wildly optimistic ones based on best wishes, or a fear of annoying Gordon Brown – brings windfall benefits. In Singapore’s case, using conservative estimates for planning over a 25 year period brought an unexpected income gain worth £142 million per year.

This, the report concludes, was ‘
simply a by-product of the [Singapore] Government's philosophy of “fiscal prudence”.’

Let's dump Gordon and bring Prudence back to Britain.
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‘Singapore's recurrent budget surplus: The role of conservative growth forecasts’

Department of Economics, National University of Singapore, Block AS2, #05-11, 1 Arts Link, Singapore 117570, Singapore

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