Speaking on Sky News, Lord King criticised the UK government’s lack of ambition. He said: “When you’re facing a very difficult position, it pays to be bold and ambitious. And I don’t think the government is being either in their approach so far.”

He argued that the Chancellor should present a clear long-term spending plan, rather than reacting solely to Office for Budget Responsibility (OBR) forecasts.

Lord King emphasised the need for a “genuine narrative” regarding government expenditure, outlining commitments for key areas like health, defence, and social care. He asserted that achieving increased defence spending, aligned with the government’s 3% of GDP target, and implementing necessary reforms would require additional revenue.

“The obvious tax to raise is the basic rate of income tax,” he suggested, advocating for a broad contribution.

His comments precede the spring statement, where the Chancellor faces pressure to balance fiscal rules amidst calls for increased defence funding. Analysts estimate that significant tax rises or spending cuts, potentially around £20 billion, may be required to meet these demands.