The Liberal Democrats under-cost programme by £1.7Billion
have admitted to an undercosting of £1.7bn ($2.2bn) in spending figures presented in their manifesto, following calculations from Yahoo Finance UK.
The £1.7bn shortfall is in their day-to-day costs, government spending excluding capital expenditure. The party miscalculated costs around the policy of reintroducing maintenance grants for university students. It mistakenly included capital spending reductions as a day-to-day saving, thus artificially lowering the cost of the policy.
When questions were raised by Yahoo Finance UK to the party’s economic spokesperson Ed Davey, he said “I’m afraid I would need to go back to how we costed rigorously. The IFS [Institute for Fiscal Studies] have costed all of our numbers, so what’s good enough for the IFS is good enough for me. With due respect to Yahoo [Finance UK], the IFS are the most prestigious public finance organisation in the country.
“We have costed it really carefully…[and] the IFS are the experts on this”. However, when details of Yahoo Finance UK’s calculations were presented to a Liberal Democrat spokesperson after the interview with Davey, the party confirmed that there would be an additional £1.7bn cost to the policy in day-to-day spending, partially offset by a reduction in capital spending.
And they have pretensions of government?