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Government Capital Expenditure

Although £12 billion is a lot of money, the Government's fiscal stimulus is not large in terms of the British economy. It is less than 1 per cent. of the economy, which is a much smaller proportion than in the United States. We have supported that measure, but we suggested a different mechanism for going about it. A problem arises from the fact that we have growing budget deficits and growing public debt, which may have the effect of squeezing out any future public investment, which will be crucial in providing a continued fiscal stimulus.