The Tories and Debt
Once again during the Budget Debate David Cameron has focused on debt levels. He keeps saying that the UK has an extraordinary debt level.
Some perspective on this lie is provided by the fact that we entered the recession with the second lowest level of debt of any of the G7 countries.
OECD figures for the calendar year 2009 give general government net financial liabilities as a percentage of GDP as:
United States 56.4%
This is a result of the prudent early decisions of Tony Blair and Gordon Brown, including using the £20 billion plus windfall from the G3 mobile phone spectrum auction for debt repayments. This contrasts with the Tories squandering of privatisation receipts when John Major managed to double the National Debt in five years in a far more benign world economic environment.
John Spellar MP and Michael Dugher (then the AEEU's economist, now the newly selected Labour PPC for Barnsley East) wrote a useful pamphlet at the time demolishing the myth of a ‘golden legacy’ from the Tories, a myth still propagated by Ken Clarke for obvious reasons. The pamphlet – ‘Fools Gold’ can be found at: http://www.labourlist.org/uploads/aebf61e9-d9db-d194-fd31-b1c865911cbe.pdf