These gents had the guts to explain the problem five months ago
Keating and Aubrey told us how gilts could not do the job.
Last September Thomas Aubrey and Con Keating highlighted the inanity of the Government’s plan to finance with gilts the growth needed for new towns and growth that is needed if Britain is to succeed and this Government be remembered for stimulating it.
If the full amount needed to fulfil the plans for new towns was found from gilts, the gilt market would be spooked and we would have a financial crisis the like of which we have not seen since October 2022.
You can read the last of the blogs published on here, there are also blogs on the PlayPen Coffee Morning featuring these gents.
What they argued for is now the subject by major organisations keen to make growth happen hand in hand with Government.
An important development 5 months later
Now comes an article in the FT which has seen a letter to Rachel Reeves asking that a change of position, in line with what Aubrey and Keating are asking for, be put into place. It is good to see Calum Cooper of Hymans Robertson included alongside the insurers and the USS. The FT report
Development corporations — public bodies that drive new housebuilding and regeneration — should be able to “borrow outside the fiscal rules” in line with other European countries…
If left unaddressed, this current constraint will massively inhibit [the government’s] scope to raise the UK growth rate,” it added, arguing that development corporation borrowing would not be seen as “adding to the UK’s debt sustainability challenges”.
Yes this is a pension story, because these insurers and USS and a consultancy speak as one as organisations responsible for delivering through pensions the growth the Government sees as its responsibility by 2029.
I read the article that quotes Thomas Aubrey and have been in touch with him. He pointed me to his tweets.
more jobs in the Oxford to Cambridge growth corridor.” You cannot put in a public transport system for £500m. No public transport system means you don’t get more houses at higher density to expand local labour markets & hence no boost to productivity. My @BennettSchoolPP report
— Thomas Aubrey (@ThomasAubreyCCA) February 8, 2026
on funding & financing new towns indicated the region required about £10bn in infrastructure investment that could be self-funded. https://t.co/xv77CLjXzR But HMT refuses to permit self-funding which by definition worsens the public finances as it means more gilt issuance driving
— Thomas Aubrey (@ThomasAubreyCCA) February 8, 2026
unilaterally diverged from recognised international accounting standards (ESA 2010) which emerged from the Maastricht criteria largely drawn up by the Bundesbank. These are fiscally prudent but pro-growth. The UK has junked the pro-growth bit which would ironically today prevent
— Thomas Aubrey (@ThomasAubreyCCA) February 8, 2026
robust public finances (45% debt to GDP vs UK 95%) AND higher productivity. Here is a great piece on the subject by @dsmitheconomics https://t.co/y3EMiSoMdk What is even stranger is the fact that the UK with its strong financial services sector is one of the few countries without
— Thomas Aubrey (@ThomasAubreyCCA) February 8, 2026
this @marymcdougall13 piece here https://t.co/NauT9nCVih If HMT continues with its strategy, it is a clear sign they are not serious about growth. There is widespread interest in this mechanism across the political spectrum as it has 150 years of evidence it works! If you
— Thomas Aubrey (@ThomasAubreyCCA) February 8, 2026
enjoyed this thread this @BennettSchoolPP piece provides further detail. https://t.co/a4tzjgKv9s
— Thomas Aubrey (@ThomasAubreyCCA) February 8, 2026
A consultation to get Government to realise how wrong their fiscal rule is?
Frankly the £500m Treasury promise was not going to meet the £10bn bill for the Oxford to Cambridge Growth corridor, let alone the new towns around the nation.
The FT is keen to get the question of growth a proper airing
One person familiar with the matter told the FT that the Treasury should consult on how to adjust the fiscal rules to permit borrowing by certain development corporations. Without such changes, plans for ambitious projects such as the government’s new towns and the Oxford-Cambridge Arc would lack sufficient scale, the person added.
The government on Wednesday launched a consultation on creating a new Greater Cambridge development corporation, vowing to tackle challenges including
“infrastructure deficiencies, commercial accessibility and housing affordability.”
A person familiar with the problem told me
My view is that the UK should align with internationally recognised accounting standards. The idea of the consultation is to get HMT to realise how ridiculous their rules are which are constraining growth
I think that all parties to the letter have Keating and Aubrey to thank for the publication of Aubrey’s work and for the ongoing work of Aubrey in keeping this matter in the public’s eye.
Well done the insurers , a pension scheme and a consultancy for their letter and well done the FT for publishing financing re-thought.
