Letter to the Editor of the Midweek Mercury from Cllr Robin Parker CC.
Stevenage Midweek Mercury
I will not be taking any lessons in the UK’s financial management from Labour spokesperson Chris York (Your Views, Midweek Mercury, 17 December), particularly when he quotes percentages without stating his denominator.
The Office for National Statistics (ONS) figures show that, since at least 1979, under both Conservative and Labour governments, total UK government debt has increased each year – that is, there has been an annual deficit. The only exceptions were 2 years under the Conservatives (1998 and 1999) and 4 years under Labour (1998-2001) when, in all of those cases, small surpluses were made and tiny amounts of debt were therefore repaid. Common sense dictates that if a government has to borrow, then this should be during a recession, but that when the economy is booming some debt should be repaid. Neither party did this, but the figures make clear that Labour were by far the worse culprits.
In particular, from 2002-2007, when the economy was generally doing well, the Labour government still managed to run a large deficit – in other words, they did not plan for the inevitable subsequent recession (to be expected as part of the normal economic cycle) and instead of repaying some debt in the good years, they continued to borrow large amounts, even though revenues into the Treasury were buoyant.
Then when the bankers caused the huge recession in 2008/2009, Labour had nothing in reserve and they let borrowing reach the dizzy depths of an extra £5,000 each and every single second or, about £160 billion extra each year. This was not ‘modest additional borrowing’ as claimed by Chris York – it was enormous, reckless and unsustainable extra borrowing.
The Coalition government have had to make unpopular decisions, but the deficit has now been cut by about a third, albeit less than everyone would like. My personal view, often expressed, is that even if economic indicators continue to improve, it is likely to take at least another 5 – 10 years to eliminate both the current and structural deficit.
For the avoidance of doubt, my figures exclude the bail out of financial institutions in 2008/2009, the cost of which cannot yet be calculated. The problems with the banks did not cause the deficit (which Labour was already running) but the resulting recession clearly made the deficit even worse.
Certainly there is still a long way to go with economic recovery, but growth, borrowing, inflation, unemployment, job creation and interest rates are all now moving in the right direction.
Labour have got every major call wrong on the economy in the last 5 years, whereas I am proud that at least the Liberal Democrats in government had the guts to help sort out the shambles that Labour created prior to that. And we have done so without the need to try and link our political opponents with long dead Nazis or telling lies.