New chancellor John Healey could be even worse than the previous one.

09:16, Thu, Aug 6, 2026 Updated: 09:17, Thu, Aug 6, 2026

Healey-fiscal-fiddle

John Healey is barely in post and he's already fiddling with the rules (Image: Getty)

At first, I welcomed his appointment. This was a man who resigned in the national interest because Keir Starmer wasn’t spending enough on defence. Or at least, that was his pretext. Sceptics claim it was part of the plot to bring in Andy Burnham. If it was, he has certainly got his reward: a plum job, replacing Rachel Reeves. Unfortunately, the early signs aren’t good. It already looks like he’s caving to the Labour left in ways Reeves resisted executing. He could end up being worse than her.

The country’s finances are in a dire state. Today, we learned that British national debt has just exceeded £3 trillion for the first time in history. According to the TaxPayers' Alliance, Labour now borrows £4,270 every single second. That adds up to £369million a day. Even the Resolution Foundation appears to think this is cause for alarm, having previously warned that our public finances are on a "deeply unsustainable path". They certainly are. Just look at this.

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It took more than 300 years for our national debt to rise above £1 trillion, passing that threshold in 2010. It took just 10 years to rack up the next trillion, and now the next has taken just six years. Which makes this week's news even more alarming. Incredibly, Healey is said to be fiddling with the fiscal rules to raise another £9 billion a year to spend on Labour’s pet infrastructure pledges. Isn’t Labour spending enough already?

It certainly is. The Institute for Government calculates that policy measures introduced by Labour since the 2024 election will cost us between £70billion to £80billion a year in extra spending per year by the end of the decade. And it still isn’t enough! Healey has only just entered Number 11 and already wants to add tens of billions more. It’s madness.

Even worse, he isn't being honest about it. Basically, he’ll allow the government to count spending on infrastructure or equity in companies as "assets" to offset against the cost of borrowing. It’s an accounting fix. Or to use the technical term: he’s cooking the books. While hoping voters and the bond market won't notice. This will be accompanied by lots of blether about "meeting fiscal rules".

There's a long-standing argument on the left that “borrowing to invest” is a good thing. And maybe it was when interest rates were closer to zero. I've never really bought it myself. Every penny we borrow ends up on the national debt. Which gets even more to service as interest rates rise, which is happening now. Borrowing to invest makes sense for a company. It's under pressure from shareholders to pay it back. But we all know politicians will happily let the debt and deficit roll along for the next government to fix. The Tories did that too.

Reeves set this ball rolling. She explicitly rewrote the UK Treasury's fiscal framework to give herself the headroom to borrow billions for capital investment without technically breaching fiscal targets. But she held back from pulling the trigger. Or was fired before she could.

She set up this fiddle. Healey is preparing to boot it into the net. While insisting he's sticking to inherited rules, they conveniently forget that these rules were inherited from Reeves.

He couldn't have chosen a worse time to do it, just as the national debt hits this terrifying new milestone. How many years will it be before we hit £4 trillion? At the current speed, it won't be long. Unless the bond market steps in to save us. It doesn't look like Andy Burnham will.