Spend too much? In some areas Labour didn't spend enough, says Ed Balls There would be some spending things we wouldn't do, some spending things we would do differently, some areas we'd spend more. No, I don't," he told the BBC. That analysis puts him at odds with Tony Blair, Alistair Darling and Mervyn King, who have said spending should have been brought under control several years before the financial crisis occurred. At the height of the boom in 2007, Britain had a structural deficit - that is, an underlying shortfall of tax receipts regardless of the ups and downs of the economic cycle - of 5.3 per cent of GDP, IMF figures show, the largest in the G7 club of advanced nations. Sajid Javid, the Financial Secretary to the Treasury, said: "Labour got us into a mess by spending and borrowing too much in the good years. But Ed Balls thinks the deficit was not "too high" at the time and says he would do it all over again. It's the same old Labour. The Labour leadership now faces a rift over its promise to hike tax rates for top earners. Supporters of Tony Blair and Peter Mandelson grouped around the "Progress" think tank were alarmed at the message sent to industry. "It sends completely the wrong signal to the business community internationally about our attitude to entrepreneurialism, wealth creation and aspiration," said one senior Blairite. What's the story? Labour wants to attack the rich more? The voters we need to attract are going to be turned off by that. Tristram Hunt, the shadow education secretary, said in September 2013 he had "personal reservations about taking 50p in the pound off people's income." He yesterday insisted he is "entirely supportive" of Mr Balls. Lord Noon, a Labour peer and donor who made his fortune in the curry industry, said the party was "shooting itself in the foot" and risks knocking the recovery off course with the "terrible" policy. There are other means to augment the Treasury not by penalising the business community, which is already hard-pressed," he said. Sir Maurice Hatter, the businessman who has also donated to Labour, said the move was "bull." "We need to be a bit more positive about the economy," he said. Other Labour grandees were jubilant. Lord Bhattacharyya, the industrialist and a significant donor to the party, said the tax hike would prove "very, very popular" with traditional Labour voters at the election because it will "squeeze" financiers who "caused havoc" in the economy. He's not doing it to raise money. It's not going to raise megabucks. Sometimes you have to send signals. The quick buck system has got to be squeezed. He added: "People who have caused great problems are not going to have it so easy." Alistair Darling, who brought in the 50p rate as an emergency response to the financial crisis, said he backed the move because "people with the broadest shoulders carry their fair share of the burden." Mr Balls said the policy was devised last summer and will remain in place for as long as is necessary to wipe out the deficit. He insisted New Labour did much to open up markets for business but he was forced to respond to "very difficult circumstances" caused by George Osborne's failure to bring the deficit down faster. That appears to be a watering down of Mr Miliband's position, who said when running for the Labour leadership that he would like to keep the 50p permanently. "It's about fairness in our society," Mr Miliband said. It comes as Mr Balls this weekend promised to eradicate borrowing on day-to-day Government spending by 2020. Unlike George Osborne's promise to run a surplus right across the Treasury's books, the Labour plan allows borrowing for investment. Critics said the plan closely resembled Gordon Brown's so-called "golden rule." Is Labour the party of business? Ed Balls announces the top rate will be hiked from 45p to 50p for those earning over £150,000 in order to bring the deficit down, reversing George Osborne's cut. Sir Stuart Rose who led Marks & Spencer for six years said: "This will put at risk all the good work that has been done to put the economy back on track." Ed Miliband has promised to cap the size of high street lenders and strip them of branches in order to foster competition. Simon Walker, Director General of the Institute of Directors, said: "The state has a very poor history of creating competition in banking. The last time the Government told a bank what to do, Lloyds was ordered to sell branches to Rev. Flowers, and we all know how that ended. Ed Miliband has promised to freeze energy bills for two years on entering office. Angela Knight, head of Energy UK, the trade body: "Freezing the bill may be superficially attractive, but it will also freeze the money to build and renew power stations, freeze the jobs and livelihoods of the 600,000 plus people dependent on the energy industry and make the prospect of energy shortages a reality, pushing up the prices for everyone." Ed Miliband has promised to cut taxes for small firms at the expense of big corporations. His cut would be worth an average of £450 per business property Labour claimed. John Allan, national chairman of the Federation of Small Businesses, said: "The Federation of Small Businesses (FSB) welcomes the focus by the Labour leadership on this critical issue for small businesses. It affects thousands of our members across the UK and is one which we've been lobbying on for some time. Chuka Umunna, the shadow business secretary, announces today the setting up of a Small Business Administration to address blockages to growth and act as a voice for small firms. Matthew Hancock, the Business Minister, said: ""The Government is already taking action with its new business bank, which brings all small business support under roof."