Labour’s off-the-books borrowing

Plus: consumer confidence plummets, and can Kemi make work pay?

Oct 23, 2026

Puffins are beautiful birds found across the Northern Hemisphere. PuFins or Public Financial Institutions on the other hand, need to have their wings clipped. That’s the argument made in a new report by CPS fellow Tim Dier, who warns the Government has been using them to hide debt, with alarming echoes of Labour’s costly past misadventures with PFI. Shadow Chancellor Andrew Griffith is also on the case. You can find more below.

Elsewhere today, the latest monthly figures show consumer confidence has taken a big hit since September – on a par with those caused by Brexit and the pandemic. It won’t be the news John Healey wants to see the week before his first Budget. See our Stat of the Day.

Below you’ll find all the latest pieces from CapX, plus what we’re reading from around the web.

Oscar Gill-Lewis
Deputy Editor, CapX

Today’s Takes

Fresh thinking from CapX

Labour need to stop using smoke and mirrors accounting

Tim Dier

‘In his first Budget, John Healey will likely use PuFins to bury even more borrowing, channelling billions into Labour’s pet projects.’

Public Financial Institutions (PuFin) are publicly-funded bodies that invest taxpayer money aiming to encourage private capital to follow suit. Changes made by Rachel Reeves mean that borrowing to fund PuFins doesn’t show up in government debt figures, artificially buying more fiscal headroom. The Government needs to control spending, not try to hide it. Read More

How Kemi Badenoch can make sure work always pays

John Penrose

‘Some benefits have hidden cut-offs where getting a promotion or working a few hours overtime can mean claimants cross hard-to-spot lines where the system suddenly takes away big chunks of help.’

Kemi Badenoch has faced criticism for wanting to change childcare rules which leave parents suffering crazy tax rates if they earn more than £100,000. She is right to target the worst example of a tax and benefit cliff edge – but she shouldn’t stop there. We need to ensure that work pays, at every income level. Read More

I’m on PIP – and I want welfare reform

Luke Murfitt

‘We cannot protect the vulnerable with promises the taxpayer can no longer afford.’

An entrepreneur who built a business while living with Parkinson’s argues that welfare cuts are necessary to ensure the system remains sustainable for those who need it most. But controlling the bill is only half the task. From backing disabled founders to recovery plans for sickness benefits, he sets out practical ways to spend money better. Read More

Stat of the Day

Best of the Web

Business needs to speak up in Britain's battle of ideas

Liam Halligan, City AM

‘For decades, under the Tories and now Labour, the state has been getting bigger – and is now far too intrusive and chronically unaffordable, to the extent it’s threatening financial stability.’

It is Britain’s entrepreneurs and businesses that create wealth, not politicians. In the looming battle of ideas over our country’s economic direction, business leaders must stand up to be counted. They should be pragmatic when dealing with government, but they mustn’t lose sight of what works – low taxes and a smaller state. Read More

Would a British wealth fund work?

Sam McPhail, The Spectator

‘Given that the government decided to cut £30 million from army exercises in a scramble for cost-cutting, how long would it have been before our annual investments were picked apart?’

John Healey has announced that Britain will have a sovereign oil fund like Norway. But we are different from them in important ways. Oil and gas plays a much bigger role in Norway’s GDP than ours, 20% versus 1.3%. Not to mention the likelihood that our politicians will raid the fund for parts in the coming years. Read More