Reeves’s radical change to fiscal rules could go further – New Zealand shows how

New Zealand’s net worth rules takes into account liabilities, including government debt, but also assets; including land, roads, railways, hospitals, schools, fire stations and military aircraft. Photograph: David Wall/Alamy

Rachel Reeves will this week change the way the UK government’s debt rules are calculated to unlock billions of pounds in additional headroom for spending on long-term infrastructure projects.

In what could be the most radical step in Labour’s first budget since 2010, the chancellor confirmed the decision while at the International Monetary Fund’s annual meeting in Washington DC last week, aiming to soothe any jitters in the bond markets by announcing it in front of the global economic establishment.