Miliband: Labour cannot spend big to solve Britain's problems

Labour leader Ed Miliband has said the party cannot revert to a high-spending approach to social and economic problems if it wins next year's general election.

Mr Miliband told party activists that higher spending was not the answer to the country's issues, as "you and I know we won't have the money".

He also argued that Labour must be "more ambitious" in reforming areas including banks, energy markets, skills, housing and pay.

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Miliband: 'We have moved on from New Labour'

Ed Miliband will mark out a "new direction" for the Labour Party today as he tells a major party event that Tony Blair and Gordon Brown "did not do enough" to fix fundamental problems with the economy.

In a sign that he is trying to distance himself from previous Labour leaders, Mr Miliband will say: "We have moved on from New Labour. And we are not going back to old Labour."

Speaking at the National Policy Forum in Milton Keynes, Mr Miliband will argue Labour "did great things in Government to redistribute resources" but failed to tackle problems such as inequality and low rates of pay.

He will say a Labour government would instigate a programme to build "a wholly new economy, fit for the 21st century".

Miliband: No return to Labour's big-spending approach

Labour leader Ed Miliband will tell the party's national policy forum that the party cannot revert to its traditional high-spending approach to social and economic problems if it wins next year's general election.

Labour leader Ed Miliband says the party must be 'more ambitious' in addressing the UK's problems. Credit: PA

Mr Miliband will tell activists at the three-day event in Milton Keynes that higher spending is not the answer to the country's issues, as "you and I know we won't have the money".

"Higher spending is not the answer to the economic problem that we together have identified. Unless we fundamentally reshape our economy, we will only be able to compensate people for inequality and unfairness," Mr Miliband is expected to say.

He will also argue that Labour must be "more ambitious" in reforming areas including banks, energy markets, skills, housing and pay.

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