Ed Balls was heckled by trade unionists today as he warned that a future Labour government would have to make “painful” spending cuts.
The shadow chancellor said “difficult decisions” on pay, pensions and spending will still have to be taken even after the Coalition leaves office.
“We must be honest with the British people that under Labour, there would have been cuts, and that — on spending, pay and pensions — there will be disappointments and difficult decisions from which we will not flinch,” he told delegates at the Trades Union Congress, to cries of “rubbish” from some of the delegates in Brighton.
PCS president Janice Godrich told him his backing for the Government pay freeze was “extremely disappointing”.
Mr Balls began by saying he had been “proud” to join union marches against Coalition policies. But he then poured cold water on the mood by saying that Labour would inherit a “substantial deficit” if it wins in 2015.
“It will fall to the next Labour government to clear up George Osborne’s economic mess,” he said.
“Which is why, however difficult this is for me, we cannot make any commitments now that the next Labour government will be able to reverse particular tax rises or spending cuts.”
Business Secretary Vince Cable today challenged Tory thinking on the economy as he launched an industrial strategy.
He told Radio 4: “Pure laissez faire is not the right way of doing things. We do believe in getting behind our success stories.”
He set out plans for a government-backed bank to increase lending to businesses, though he could not say how much money it would have: “I’m working with the Chancellor on how big this should be, how it should operate and what the sectors that it services should be.”
In a later speech he said the credit crunch showed “there are huge risks to taking a complacent, hands-off approach”.
John Cridland, of the Confederation of British Industry, called the strategy “a valuable first step” to supporting business better.
