July 28, 2019 / 9:19 AM / 2 months ago

UK can afford to boost spending on no-deal Brexit preparations - minister

FILE PHOTO: Newly appointed Britain's Chief Secretary to the Treasury Rishi Sunak is seen outside Downing Street in London, Britain July 25, 2019. REUTERS/Hannah McKay

LONDON (Reuters) - Britain is “turbocharging” preparations for leaving the European Union without a divorce deal and can afford to spend money doing so, junior Treasury minister Rishi Sunak said on Sunday.

Sunak said new finance minister Sajid Javid would be setting out more details on ‘no deal’ spending plans this week, but cited the “fiscal headroom”, an amount of extra borrowing possible without breaking a budget deficit cap of 2% of GDP introduced by former finance minister Philip Hammond.

Asked where the money would come from, Sunak told Sky News: “We can afford this and the reason we can afford this is there has been some very careful management of the economy, there is 26.6 billion pounds of fiscal headroom next year.”

Sunak also said the government was not planning for an early election. “It is certainly not our desire,” he said.

Reporting by Kylie MacLellan; Editing by Janet Lawrence

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