UK Politics

Labour team 'at one' over deficit, says Ed Balls

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Media captionMr Balls said the most important thing is pulling the country out of the economic crisis

New shadow chancellor Ed Balls has told the BBC that he, Labour leader Ed Miliband and Alan Johnson are "at one" over reducing the deficit.

He took over from Mr Johnson, who quit on Thursday for personal reasons.

But Mr Balls has previously criticised Labour's pre-election pledge to halve the deficit in four years.

Mr Miliband said economic policy was "unchanged". Mr Balls said he had feared it would be hard to deliver but the economic picture had changed.

Mr Johnson said on Thursday he was resigning for "personal reasons to do with my family". On Friday it emerged that a policeman who protected Mr Johnson when he was home secretary has been referred to Scotland Yard's standards directorate, following newspaper allegations he had an affair with Mr Johnson's wife.

In the past Mr Balls has argued against deep spending cuts to tackle the deficit and has said the approach set out by former Labour chancellor Alistair Darling to halve the deficit within four years was "a mistake".

He told the BBC last year: "In government at the time in 2009 I always accepted collective responsibility, but at the time in 2009 I thought the pace of deficit reduction through spending cuts was not deliverable, I didn't think it could have been done."

Asked if he was pushing for a different approach on deficit reduction, Mr Balls told BBC Radio 4's World at One: "No. Let's be clear, Ed and Alan in the last few months have led a determined opposition against the fast, reckless and deep cuts that the coalition are putting through and I'm clear, if there was a Labour government today, we would be halving the deficit over four years, in fact we would be over-achieving."

He said he had concerns in 2009, given the scale of the global crisis and forecasts of rising unemployment, that it could not be delivered but it turned out growth had been stronger than forecast, unemployment was falling a year ago and policies to support the economy had worked better than expected.

He accused the coalition of having "unlearned those lessons" and putting at risk jobs and growth with "reckless" cuts.

Tough decisions

He added: "Ed Miliband, Alan Johnson and I are at one on this, the most important thing to get the deficit down is to keep the economy moving, to get more jobs, to get the economy growing.

"As part of that there are also tax rises we put in place, also tough decisions on spending.... but in the end if you don't get the jobs and growth then you don't get the deficit down, you don't get the economy moving."

Mr Balls also defended his record at the Treasury - he was Gordon Brown's chief economics adviser - saying people believed decisions he was involved with, like giving the Bank of England independence and staying out of the Euro, were a "good call" and Labour had a "good record" on the economy.

"Did we get everything right? No. Were we hit by a global financial crisis around the world? Yes we were. But when Labour was in government we didn't make the mistakes of the 1930s, those are the mistakes I now think are being made by this Tory-led coalition."

On Thursday, Ed Miliband said Mr Balls brought "great expertise" to the role, adding: "Economic policy is unchanged. Actually Ed and I have similar views." Mr Miliband has previously described Alistair Darling's plan for deficit reduction as "a starting point in terms of the timing of the deficit reduction".

Asked about his relationship with Mr Miliband and comparisons to that between Tony Blair and Gordon Brown, Mr Balls said: "We have lived very directly through difficult periods when personalities didn't get on and I think both of us have learned the right lesson from that period, which is stick together, do it together.

He added: "It's not about ego, it's about us together doing the job and I am totally 100% confident together we will do that really really well."

Mr Johnson's appointment to the shadow cabinet just three months ago came as a surprise.

Mr Balls and his wife Yvette Cooper, a former chief secretary to the Treasury, had been seen as front runners for the job.

BBC political editor Nick Robinson said the reason Mr Balls was passed over for the job was partly because he and Ed Miliband had worked together for years, with Mr Balls always the senior partner, and because he was known as a combative politician who was closely associated with Gordon Brown.

The Conservatives and Liberal Democrats said Mr Balls' appointment marked a return to strength for Gordon Brown's old guard.

Conservative Party deputy chairman Michael Fallon said: "It beggars belief that Ed Balls has been appointed as shadow chancellor of the Exchequer.

"The man who is responsible for Britain's economic mess has returned. The Labour Party has learnt nothing and is now led entirely by Gordon Brown's old team."

And Lib Dem deputy leader Simon Hughes said Mr Balls was "the man who can be pinned with the responsibility for the mega-debt that we are all having to pay off".

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