**September 15th UPDATE**
The SLF’s amendments to tomorrow’s economic policy debate have rightly attracted attention from party members, the leadership and the media.(Amendment 1 (future economic strategy) will be moved by Naomi Smith and summated by David Howarth. Amendment 2 (for homes and jobs) will be moved by John (Lord) Shipley, Summator Paul Holmes).
In an interview with the Independent, Nick Clegg suggests that in amending his motion, the party risks putting the economic recovery in reverse. Nothing could be further from the truth. As SLF Director Dr Buch makes clear, not only is the recovery itself incomplete and built on unsustainable debt and rising house prices, the amendments seek to boost the commitments on jobs, housing and living standards made elsewhere by our party.
There have been claims made that the amendments ‘tear up the fiscal mandate’ and ‘threaten the independence of the Bank of England.’ Dealing with these in turn:
We seek a rebalanced fiscal mandate, one that pays more attention to jobs and earned income than is currently the case, with the mandate prioritising balanced budgets over a truly balanced economy. We call for the fiscal position to be rebalanced to reflect greater emphasis on tax rises than on spending cuts – which if unchanged, mean 100% of any further deficit reduction from today onwards comes from spending cuts, with not tax rises.
On the Bank’s independence, Bill le Breton clears up the misunderstanding – or, in places, misinformation – about this at Lib Dem Voice. The Bank is independent in its choice of tools it chooses to meet its target – it has operational independence, as our party policy has always been. The target, the bank’s mandate, is set by the chancellor and is reviewed every single year under the terms of the Bank of England Act 1998. Yes we’re calling for that target to be changed – to consider jobs and incomes alongside inflation, alongside, but that isn’t threatening the Bank’s independence in anyway. It can chose the tools it sees fit to meet that target.
As the Guardian rightly says, these are asks that the party can and should adopt – it’s hardly Bolshevism.
September 14th On Monday, Liberal Democrats will debate economic policy at our Glasgow conference. The SLF has submitted two amendments – supported by an unprecedented number of voting members – that improve this motion.
You can find out more about the amendments, and the rationale behind them, using this app.
In seeking to amend the motion, we contend that the motion has to go further than current Coalition policy as it approaches the next election, to demonstrate we are an independent party. Further, on housing, there is an acute need for an ambitious housebuilding policy that would boost the construction industry, raise employment and alleviate the housing shortage. For this investment-driven approach, both fiscal and monetary policy need to change.
This is in contrast to how the party’s leadership has interpreted our amendments, despite party commentators suggesting that the best approach would be to support the changes. During the debate, we plan to clear up any misunderstandings over the effect and intention of these constructive amendments.
We will update this page, and our Twitter and Facebook streams, with further updates.