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Public Expenditure: Review of Commitments

I thank the noble Lord, Lord Howarth, for his comments, but we really do need to get back to the central point today, which is that the previous Government left us with a series of projects that are unaffordable and in many cases present poor value for money. We need to do this. There are huge pressures on public expenditure, which are going to be looked at in the round through the spending review, but we have to take off the further pressures that have been put on by projects that simply cannot be justified. That will provide us with a much better baseline from which decisions made in the Budget next week and then in the spending round going forward can be taken to protect what really matters—projects that present good opportunities to invest in sustainable growth in the future. That is absolutely central and the announcement today helps to contribute to it. In the short term, I cannot stress enough that to pay for these projects the previous Government were relying on an assumption that £7 billion of underspend would be made in the current year. That is approximately 1.8 per cent of DEL expenditure, but the evidence of recent years shows that the underspend has been reducing to what is estimated to be less than 1 per cent of DEL in 2009-10. The issue is not whether these projects stack up as value for money but that there is simply no money left to pay for them. I would like to make a point about Stonehenge. I would hate anyone to be left with the thought that we are somehow abolishing Stonehenge or knocking it down—I see that the noble Lord agrees with that. Of course it would be nice to enhance the visitor centre, but unfortunately this is a project that does not stack up in the current circumstances.