The Golden Rule in The United Kingdom
The Golden Rule was one of several fiscal policy principles set out by the incoming Labour government in 1997. These were first set out by then Chancellor of the Exchequer Gordon Brown in his 1997 budget speech. Subsequently they were formalised in the Finance Act 1998 and in the Code for Fiscal Stability, approved by the House of Commons in December 1998.
In 2005 there was speculation that the Chancellor had manipulated these rules as the treasury had moved the reference frame for the start of the economic cycle to two years earlier (from 1999 to 1997). The implications of this are to allow for £18 billion - £22 billion more of borrowing.
The Government's other fiscal rule is the Sustainable investment rule, which requires it to keep debt at a "prudent level". This is currently set at below 40% of GDP in each year of the current cycle.
As of 2009, the Golden rule has been abandoned.
Read more about this topic: Golden Rule (fiscal Policy)
Famous quotes containing the words golden, rule, united and/or kingdom:
“You must have been warned against letting the golden hours slip by. Yes, but some of them are golden only because we let them slip.”
—J.M. (James Matthew)
“After all, the practical reason why, when the power is once in the hands of the people, a majority are permitted, and for a long period continue, to rule is not because they are most likely to be in the right, nor because this seems fairest to the minority, but because they are physically the strongest. But a government in which the majority rule in all cases cannot be based on justice, even as far as men understand it.”
—Henry David Thoreau (1817–1862)
“Prior to the meeting, there was a prayer. In general, in the United States there was always praying.”
—Friedrich Dürrenmatt (1921–1990)
“This is the Key of the Kingdom:
In that Kingdom is a city;”
—Unknown. This Is the Key (l. 1–2)