Chris Leslie MP, Labour’s Shadow Chief Secretary to the Treasury, will tomorrow (Friday) give a speech on deficit reduction and an update on Labour’s Zero-Based Review of every pound of government spending.

He will set out the challenge facing an incoming Labour government and affirm Labour’s commitment to balancing the books in the next Parliament:

“Labour will get the current budget into surplus and national debt falling as soon as possible in the next Parliament.

“All my Shadow Cabinet colleagues know that the settlements we will need to make following the general election will be the toughest faced by an incoming Labour government for a generation.

“Labour’s Policy Review process will culminate at our National Policy Forum in July. Ed Balls, Jon Cruddas and I have been clear that our conclusions and agenda will be radical but suited to our times. So it will not be about spending commitments, but solutions that are funded, achievable and which can be delivered in office.”

His speech, at the Institute for Chartered Accountants for England and Wales, will set out how the next Labour Government will place long-termism at the heart of public spending plans. He will say:

“The next Labour Government will take a more strategic long-term approach to the savings that need to be made.

“So Ed Balls and I have concluded that a Labour Treasury will put an end to the one year spending reviews recently introduced by George Osborne. We will instead set out Spending Review plans on a multi-year basis.

“And we would go further and expect departments in turn to provide public bodies and organisations under their stewardship with the same longer-term certainties, so they can make better decisions and plan for the savings they will need to make.

“As we have seen across local government and various agencies, keeping public services in the dark makes it harder to plan the fundamental reforms that ought to be addressed.

“There are too many instances of short-term budget decisions that cost more in the long run:

• The closure of fourteen prisons at the Ministry of Justice, creating a shortage of capacity and provoking Ministers to later change tack and commission new ‘Titan’ prison projects which appear unfunded and may even worsen re-offending.

• A decision to withdraw the A14 upgrade in 2010 as “unaffordable” at £1.3 billion – yet the resurrection of the same scheme in 2013 now costing £1.5 billion.

• The roads maintenance budget for local authorities cut by a fifth in 2013, followed by an about-turn in 2014 with a complex ‘Potholes Challenge Fund’ assessed by Whitehall civil servants on the basis of bureaucratic bids submitted from town halls – hardly progress towards localism.

• And not forgetting the bedroom tax, which not only causes great hardship but merely shunts costs from local authority housing benefit and into the more expensive private rented sector element of housing benefit.”

In a speech that will also address the causes of social security inflation, the management of future public sector liabilities, and strengthening the supervision of major government projects, he will also say:

“All government departments in the next Labour Government will have to face fundamental questions as never before. I’m not heading into this expecting popularity. Quite the opposite. We won’t be able to undo the cuts that the have been felt in recent years. And I know that this will be disappointing for many people. A more limited pot of money will have to be spent on a smaller number of priorities. Lower priorities will get less.

“We are not arguing with the government about the scale of the challenge. But we do differ significantly on the best way to confront it. George Osborne has had his five years to eradicate the deficit. I am determined that we finish that task on which he has failed.

“As last week’s elections showed, the public want the realistic prospect of change, not just more of the same. And they want Labour to focus relentlessly on how it would deliver those changes.

“These are serious times and they demand a hard-headed approach from political parties seeking the chance to govern. By taking the long-term perspective and reviewing every item of government expenditure from the ground up I am confident we can get the job done.”