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Boris Johnson defends scale of ‘New Deal’ after claims it fails to live up to ‘Rooseveltian’ ambition at £75-a-head

Boris Johnson defended the scale of his so-called 'New Deal' for the economy (Sky News)

4 min read

Boris Johnson has defended the scale of his self-declared “New Deal” after suggestions the plan fails to live up to the ambition of its namesake.

The Prime Minister said the initial package of £5billion of investment in the economy is part of a “massive programme overall” to tackle the impact of the coronavirus crisis.

It comes after it was pointed out the money announced at his “build, build, build” speech in Dudley equates to around just £75 per person.

And the figure represents around 0.2.% of the UK’s current GDP, while the spending in the original “New Deal” from American president Franklin D Roosevelt in the 1930s was around 40% of that country’s economic output before the Great Depression.

Labour's Keir Starmer said there was "not much that’s new and it’s not much of a deal".

Outlining his plans Mr Johnson said: “I am conscious, as I say all this, that it sounds like a prodigious amount of government intervention. It sounds like a New Deal.

“And all I can say is that if so, then that is how it is meant to sound and to be. Because that is what the times demand.”

But the PM was asked how that matches his lofty rhetoric to not just “bounce back” but “bounce forward” out of the downturn created by the Covid-19 pandemic.

“You're absolutely right to say that the the initial package that we're talking about is £5billion pounds,” he told the BBC at the speech in Dudley. “But you know that's not an insignificant sum.

“That's part of a massive programme overall £34billion pounds on the NHS, £14billion pounds on education, £100billion pounds on infrastructure, you know, these sums mount up.”

The PM added: “Now there’s a reason we can do this. As I say we've managed the economy prudently. 

“It's the right time to borrow, but what we're saying is that this is the moment to make that big big long term state - that backing of Britain. 

“Because that will deliver the long-term productivity gains, the gains that will in the end, deliver the tax revenues, that of course we're going to need down the line.

“We can balance this over the cycle, but we must must must make the investment now. That is the right way forward.”

Mr Johnson meanwhile denied simply re-iterating policies already outlined in his election manifesto from last year, as he said: “Let me just focus on that word 'speeded up' - because that's the thing. 

“Because it's not just speeded up, it's also intensified and increased because, as I said, to everybody earlier on, we all know what costs money in this country.

“It's the delay. It's the bureaucracy. It's the planning delays that are adding so massively to the costs for young people, particularly for housing.”

He added: ”This is not just about investment, the government leading the way. It's also about the government trying to clear the way and to get things done faster.”

Elsewhere in his speech Mr Johnson urged the country to clap for "wealth creators, capitalists and financiers” as well as NHS workers, and unveiled radical changes to the planning system as part of his plans to “build, build, build” the UK out of the coronavirus crisis.

Reacting to the speech, Labour's Sir Keir starmer said: "The Prime Minister promised a new deal. But there’s not much that’s new and it’s not much of a deal."

He added: "We’re facing an economic crisis, the biggest we’ve seen in a generation and the recovery needs to match that.

"What’s been announced amounts to less than £100 per person and it’s the reannouncement of many manifesto pledges and commitments. So it’s not enough."

And the Labour leader said: "We’re not going to argue against a recovery plan. But the focus has to be on jobs.

"People are likely to lose their jobs in huge numbers ove rthe coming months. But we need a laser-like focusing on preserving those jobs.

"Building in the future? there’s nothing wrong with that. But if these jobs are lost we’re going to have mass unemployment."

The CBI business lobby group said Mr Johnson’s plans “could help limit the damage and set the UK on course to build back better”.

But the organisation’s director Caroyln Fairbairn said: “The reality is that longer-term plans will falter without continued help for firms still in desperate difficulty. Government intervention so far has saved countless jobs, yet anxious months for many still lie ahead.

"The focus on rescuing viable firms cannot slip while the UK looks to recovery, or earlier efforts could be wasted.”

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