Tory Chancellor Philip Hammond - an unsafe pair of hands.
Tory Chancellor Philip Hammond - an unsafe pair of hands.

Your candidates for South West Holderness were out canvassing in Hedon over the weekend, and overall we had a positive response.

What is always interesting about these sessions is the doorstep debates we get into (mostly polite and good-natured), and we are often given reasons why people won’t be voting Labour.

One of the reasons often given is that ‘Labour would bankrupt the country’ or ‘Labour would increase the National Debt’. Despite the fact that Jeremy Corbyn’s radical manifesto is fully costed, this myth perpetuates. Yet it is simply that – a myth.

Richard Murphy, a respected chartered accountant writing for Tax Research UK, did some analysis on this in 2016. The article makes for very interesting reading.

The article was written as a response to interviews on LBC and Radio 5 Live, where the interviewers “were quite explicit in stating that it was known that Labour always borrowed more than the Conservatives and that was why the electorate could not trust them with the economy.” Murphy provided an analysis that rebuts this view.

First, he took data on borrowing by year from 1946/47 onwards – a 70 year period during which Labour was in office for 28 years and the Conservatives for 42. He then calculated the total net borrowing in Labour and Conservative years and averaged them by the number of years in office. Finally, he restated all borrowing in 2014 prices to eliminate any bias from the fact that the value of money changes over time.

The outcome showed that the Tories borrowed an average of £33.5bn per year compared to Labour’s £26.8bn per year – a difference of nearly £7bn per year! Or a quarter as much again!

Many will say: “Well of course the Tories spent more, they had the financial crash to contend with!” Murphy answers this by excluding the financial crisis figures. The Tories still beat Labour on borrowing by £20.6bn to £17.8bn!

He also showed that Labour is generally better at paying down the debt. In 7 of their 28 years in power, Labour managed to pay back the National Debt. The Tories only managed it in 4 of their 42 years!

Labour not only repaid more often, it turns out: it also repaid much more in total during each year when repayment was made.  Adjusted for the increase in the value of money, Labour paid back £108.8bn to the Tories £19.9bn – over 5 times more!

As Murphy puts it at the end of the article, “the Conservatives are the party of high UK borrowing and low debt repayment contrary to all popular belief, including that of most radio presenters”.

The Tories ‘over-spending’ and failure to pay off debt is all the more remarkable when you consider how many assets they have sold off for a lot of cash (even if well below true value) to their corporate chums. Fiscal responsibility, anyone?

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