Tories to match Labour on spending

George Osborne has said the Conservatives will match Labour's spending plans.

The shadow chancellor announced on Monday that the party would spend the same amount as the government over the years to 2010/11.

Writing in the Times, he said the move would guarantee "real increases in spending on public services, year after year".

He said a future Conservative administration would aim to "share the proceeds of economic growth" between public services and tax cuts.

Labour spending totals for the years 2008/09 to 2010/11 show public spending growing by two per cent in real terms, below the 2.75 per cent trend growth rate of the economy, Osborne noted.

"Today, I can confirm for the first time that a Conservative government will adopt these spending totals," he wrote.

"Total government spending will rise by two per cent a year in real terms, from £615bn next year to £674bn in the year 2010/11.

"Like Labour, we will review the final year's total in a spending review in 2009."

The shadow chancellor said the announcement would mean that claims a Conservative administration would cut services "becomes transparently false".

"At the same time, the share of national income taken by the state will start to fall, as the economy grows faster than the government does," he said.

"Pursuing this approach over an economic cycle creates the headroom for sustainably lower taxes."