A new row has erupted between the main political parties over their spending plans after business secretary Lord Mandelson appeared to suggest that Labour would have to start making cuts this year.
Nick Clegg, Gordon Brown and David Cameron
The Tories claimed he had “blown apart” Gordon Brown’s argument that the economic recovery was still too fragile to begin tackling the UK’s £178bn deficit.
Public spending will rise in 2010-11 to support the economy until recovery is secured
However, a spokesman for Lord Mandelson issued a statement insisting it was still the government’s policy to increase public spending during the financial year 2010-11 while the recovery was secured.
The controversy broke out after the business secretary delivered a speech in Nottingham in which he insisted the university sector - which has had its 2010-11 budget cut by £449m - was not being “singled out” for special treatment.
“Much of the rest of the public sector will receive similar constraints in the course of this year or soon after,” he said.
“I have always said that higher education would have to bear its share of public spending cuts, but not more.”
His comments were seized on by shadow treasury chief secretary Philip Hammond who said they showed it was possible to start cutting the deficit this year as the Tories have promised to do.
“Peter Mandelson has blown apart Gordon Brown’s claim that spending cuts this year would undermine the recovery,” he said.
Lord Mandelson’s spokesman dismissed the comments, saying: “Our policy is clear and consistent, as set out by the chancellor in the pre-Budget report, public spending will rise in 2010-11 to support the economy until recovery is secured.”