George Osborne, Britain’s finance minister, delivered his so-called autumn statement (in December!) today. This covers the current state of public finances and plans for future tax and spending measures.
The Conservative-led coalition faces an election next May and its main pledge when it came into office in May 2010 was to ‘balance the budget’ and reduce government debt. After the huge bank bailout and the impact of the Great Recession of 2008-9 on tax revenues and welfare spending, the government deficit stood at over 10% of GDP and gross government debt had rocketed to over 75% of GDP.
The government blamed this on the profligacy of the previous Labour government. This was nonsense, of course. Labour had run relatively small deficits, has reduced government spending as a share of GDP and debt was low until the global banking crash.
And the Conservatives would have done exactly the same as Labour…
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