for extra borrowing, but rachel reeves is, we understand, likely to use a different measure of the national debt, one that also takes into account more government financial assets, such as the student loans made by the state. so what is the significance of that? as you can see, it falls by more in the five years. the upshot is it would enable her to borrow more over the parliament to spend on capital infrastructure. so, what is that? it is things like new transport links, new schools and hospitals and also new energy schemes. she argues those are investments that will enable the uk economy to grow faster than it otherwise would in the long run. many economists think this is a coherent argument, yet they argue it is vital the infrastructure spending projects are wisely chosen and genuinely do boost the economy in the long run. and, after the experience of liz truss�*s mini budget in 2022, one of the most importantjobs

for rachel reeves today, is to convince the financial markets from who she will be borrowing that extra money that the plan adds up. that is a huge part of today's budget, the change in the fiscal rules and what that opens up for the government. let's get more on that state of the economy with michaeljacobs, the professor of political economy at the university of sheffield. the uk for quite a long time has had the lowest rates of investments of major western countries. particularly public investment has cut over the last 1a years, so getting that rate of investment up is what creates productivity and growth and that above all, is what the country the economy needs. in the country the economy needs. in terms of how it's done, i was listening to someone on the radio

this morning saying that crucial to him, was the pace of it. funding and planning for the various projects... the money can be allocated quickly but however long it takes to spend depends. a railway line that has been completely planned butjust as i got the cash, but one that doesn't have planning permission is going to take longer. obviously the government wants a political result in the next five years, it may not get some of that till the next parliament which is why the prime minister talks about a ten year programme for national renewal. some of it, if you can employ more nurses or doctors or ghetto new mri scanner could happen more quickly. getting people back into work will help the

economy. its public investment and investment in research and businesses in the private sector. how much does this country lag in terms of basic investment? this year not very much _ terms of basic investment? this year not very much because _ terms of basic investment? this year not very much because there - terms of basic investment? this year not very much because there has - terms of basic investment? this year. not very much because there has been a bit of an increase but consistently over the last 15 years, we come 37... —— 27 out of 33. that's the reason our economy doesn't grow very fast. this is why the government is placing so much emphasis on investment for growth. to do that they're going to borrow some more but by changing the fiscal rules and changing the definition of debt they creating a more room and most economies would say that is a good thing. just

most economies would say that is a uuoodthin. , ,., ., most economies would say that is a good thing-— good thing. just explain for people watchin: in good thing. just explain for people watching in terms _ good thing. just explain for people watching in terms of— good thing. just explain for people watching in terms of investment, i good thing. just explain for people i watching in terms of investment, how does it work. if the government invest more in various products is that matched by things like pension funds, foreign investment or is that simply hope? funds, foreign investment or is that simply horn?— funds, foreign investment or is that simply wipe?— simply hope? there are two kinds, one is in the _ simply hope? there are two kinds, one is in the public— simply hope? there are two kinds, one is in the public sector, - simply hope? there are two kinds, one is in the public sector, new. one is in the public sector, new equipment for the nhs or or research and development or universities. that will have two effects, improve productivity and giving money to more people working in those sectors. and then there is investment in the private sector. the national wealth fund, which will invest alongside the public sector, invest alongside the public sector, in green steel for example or carbon capture, green energy in particular, transport and so on. it is investment in the public sector and

investment in the public sector and investment alongside in the private sector which will generate growth. how do you actually frame a budget of this importance? earlier i spoke to is rupert harrison, a senior advisor at macro advisory partners. he chaired the uk council of economic advisers under george osborne when he was chancellor. there are a lot of analysts who are comparing this to george osborne's budget. i asked comparing this to george osborne's budget. iasked him if he comparing this to george osborne's budget. i asked him if he thought today had echoes. it’s budget. i asked him if he thought today had echoes.— today had echoes. it's probably auoin to today had echoes. it's probably going to be _ today had echoes. it's probably going to be different _ today had echoes. it's probably going to be different because l today had echoes. it's probably - going to be different because going to see huge tax rises. the first budget sets the tone for the whole of the coming parliament. i think this is definitely an echo, but i think it's a major difference

because in 2010 the conservatives had spent a year talking about the difficult decisions that were going to have to be made. i do think there's a big difference now because we haven't had... i do think there's a difference now because we have had a difference now because we have had a labour government which has said we will not raise guff taxes but now they are. do we will not raise guff taxes but now the are. ,, ~ we will not raise guff taxes but now the are. i. ~ �*, ., they are. do you think there's a risk that it _ they are. do you think there's a risk that it reminds _ they are. do you think there's a risk that it reminds you - they are. do you think there's a risk that it reminds you of - they are. do you think there's a risk that it reminds you of 1992 | they are. do you think there's a - risk that it reminds you of 1992 and broken promises around tax? rachel reeves is taking _ broken promises around tax? rachel reeves is taking to _ broken promises around tax? rachel reeves is taking to be _ broken promises around tax? rachel reeves is taking to be gambles - reeves is taking to be gambles today. go back to 1992 and there was criticism of labour for raising taxes and then the conservatives had to raise taxes and the... find

taxes and then the conservatives had to raise taxes and the. . ._ to raise taxes and the... and there ou see to raise taxes and the... and there you see while _ to raise taxes and the... and there you see while he _ to raise taxes and the... and there you see while he was _ to raise taxes and the... and there you see while he was talking - to raise taxes and the... and there you see while he was talking to - to raise taxes and the... and there j you see while he was talking to me some of the departures from cabinet. let me show you the cabinet again because we are not far from the start of prime minister's questions... the chamber is full and it will get even fuller in the next five or ten minutes that is how far we are away from pm cues. joining me now is our political correspondent helen catt. this is a big big moment for labour? yes this is the time that labour will signal what is different from

the conservatives. we have seen rachel reeves set this up... comparing it to the labour budget in 1945 to rebuild after the war. she drew on harold wilson's phrase of white heat of technology, so this is certainly a really big moment for them to set out that broader agenda and also the detail of what we're going to expect over the next five years of this parliamentary term. historically this is the first female chancellor so that in itself makes it a really big moment as well. ~ .., makes it a really big moment as well. ~ _, ., ., . , well. will come to the raw politics in a moment- _ well. will come to the raw politics in a moment. but _ well. will come to the raw politics in a moment. but some _ well. will come to the raw politics | in a moment. but some difficulties in a moment. but some difficulties in terms of the structural... and the huge appetite of the public to see change now. that

the huge appetite of the public to see change now.— see change now. that was the election campaign _ see change now. that was the election campaign that - see change now. that was the election campaign that labour see change now. that was the - election campaign that labour won on, but we have heard keir starmer talk about patients, the general gist of this budget is to put the pain in now and the term of tax rises but then we will also get investment. invest, invest, invest has been the basis of this budget. the idea being down the line you will get the economic growth. that is the pitch they will be making. the conservatives, though, looking back to the election campaign, suggesting this is a budget of broken promises on some of the specifics, particularly around tax rises. . , specifics, particularly around tax rises. ., , rises. that is where the political noise will come _ rises. that is where the political noise will come from... - rises. that is where the political noise will come from... tax - rises. that is where the political| noise will come from... tax rises strai . ht noise will come from... tax rises straight after _ noise will come from... tax rises straight after an _ noise will come from... tax rises straight after an election - noise will come from... tax rises straight after an election is - noise will come from... tax rises straight after an election is not i straight after an election is not unusual, it is where you would

expect the government to do the difficult things because you have a few years until you have to be voted for again. few years until you have to be voted foragain. but few years until you have to be voted for again. but because they made quite specific tax promises at the election, particularly that phrase in the manifesto that they would not increase tax on working people, which is why they will not increase the rate of national insurance, income tax or vat, that is what it has been a lot of the focus so far. the fact that she is going to raise national insurance for the employers, breaks that election manifesto. . , employers, breaks that election manifesto-— employers, breaks that election manifesto. ., , ,, , manifesto. that is the issue she box herself them — manifesto. that is the issue she box herself them with _ manifesto. that is the issue she box herself them with those _ manifesto. that is the issue she box herself them with those tax - manifesto. that is the issue she box herself them with those tax rises . herself them with those tax rises and what they said in the manifesto... and what they said in the manifesto. . ._ and what they said in the manifesto... ,, , ., , manifesto... she is also said she won't raise... _ manifesto... she is also said she won't raise... she _ manifesto... she is also said she won't raise... she is _ manifesto... she is also said she won't raise... she is going - manifesto... she is also said she won't raise... she is going into i won't raise... she is going into this with most of the lever she can

pull box off. the tory strategy in the campaign was to box them off on tax rises. she has been left in that position to find quite a lot of money without being able to pull those tax levers. the— money without being able to pull those tax levers. the when she says she lans those tax levers. the when she says she plans to — those tax levers. the when she says she plans to puts — those tax levers. the when she says she plans to puts more _ those tax levers. the when she says she plans to puts more pounds - those tax levers. the when she says she plans to puts more pounds in i she plans to puts more pounds in more pockets, do we have any indication of how she plans to do that? i indication of how she plans to do that? ., �* 4' indication of how she plans to do that? ., �* ~ �* , indication of how she plans to do that? ., �* ~ �*, , . ., that? i don't think it's been clear. in the immediate _ that? i don't think it's been clear. in the immediate term _ that? i don't think it's been clear. in the immediate term they're - in the immediate term they're talking about protecting peoples payslips so you should not expect to wake up at the end of the month to find that you are paying more than you are today. but that idea of putting pounds in pockets is i think given that the other languages been using, is if you put the investment in then down the line that makes people better off. there will be questions raised by economies and political opponents that will that be the case of putting tax on

business is that going to slow growth? there is going to be a lot of examination in the next few days to try and work out whether that will fulfil that pledge that she is making. ah. will fulfil that pledge that she is makinr. �* ., ., , , will fulfil that pledge that she is makinr. �* ., ., , ., , making. a lot of guests already makin: making. a lot of guests already making the _ making. a lot of guests already making the point _ making. a lot of guests already making the point about - making. a lot of guests already making the point about the - making. a lot of guests already i making the point about the nhs, making. a lot of guests already - making the point about the nhs, the amount of money and percentage increase will be vital between the difference of staying still and actually making significant improvement.— actually making significant imrovement. ., , ., , improvement. the conservative plans over the next — improvement. the conservative plans over the next few _ improvement. the conservative plans over the next few years _ improvement. the conservative plans over the next few years were - improvement. the conservative plans over the next few years were very, i over the next few years were very, very tight, and labour have said they will not stick to it but it needs more money to be able to move forward rather thanjust needs more money to be able to move forward rather than just say still. there will be a bit on the amount, but the government has also been clear that it is expecting reform to come with any money that goes in, particularly to the nhs. we may m