Professor Michael McMahon:

Again, as we have said - we said this last year and we are saying it again this year - there are people who are being very badly hit and there are mechanisms within fiscal policy to address that. That is a decision for the Government of the day but the extent of targeting could allow you to rob and spread it so widely, you could spread it more targeted at those most in need. That is a decision for the Government of the day.

On capital however, at some level every capital spending project is a one-off. They come with maintenance costs, which also go into core spending, but we treat capital spending as part of core spending. Windfall capital spending is just extra capital spending and therefore should also be included within the core measures. This is the point we make about gimmicky. We are not arguing that there is no need for extra spending. I really wish to emphasise this conflation of the two as equivalent. There is a decision on the right aggregate amount of fiscal stimulus, and then there is a question about the way in which the budget is presented and the way in which the numbers are accounted for. These are separate issues. As we said, there is a good case for more capital spending. There is, though, a question about the value for money and the inflationary impact of extra spending at a time when the construction sector is extremely tight. This is a point we have made before. This is why we argued, as we talked about in the opening statement, for the need for a plan. We have a national development plan. There are also potential ways to be less inflationary in the capital spending. A case could be made for trying to do that but this was not exactly what was put forward. It was simply put forward as windfall capital spending and treated as neither core nor non-core spending but as its own separate topic. This is the extent of gimmickry.