Letter from County and Borough Councillor Robin Parker to the respective Editors of Comet and Midweek Mercury
In trying to defend the reckless additional borrowing by the last Labour Government, by stating that it was necessary to save the economy and prevent the banks from going bust, Labour spokesperson Chris York conveniently ignores the fact that the Office for National Statistics (ONS) figures, which I quoted, are all excluding bank interventions – that is, not to do with “saving the banks”. The cost of that is in addition to my quoted figures and, in any case, will not be known for some years, until the full returns to the taxpayer (if any) by selling the nationalised banks, or parts thereof, are known.
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.
I am also not sure from where he gets his assertions about the Labour government reducing net national debt. Whilst it is true that, as a percentage of Gross Domestic Product (GDP), public sector net debt was fairly static, at around 35% of GDP in the earlier years of that government, a good part of the reason for this was that GDP increased, thus even an increasing debt did not impact so much on the percentage of GDP. However, during the final years of the Labour government (07 – 10) it shot up to over 60% of GDP, and has continued to increase since then, albeit at a slower rate. The actual public sector net debt followed a similar pattern.
Possibly we can agree that both the Deficit and the National Debt are still both too high to be sustainable. Labour’s announcements of intended extra spending and the Tories announcements of intended £7 billion further tax cuts are both unrealistic.