Private sector shrivels under Labour, says Policy Exchange
BRITAIN’S private sector will be smaller in 2010 than when Labour was returned to office in 1997, according to figures calculated by the Policy Exchange think tank.
The economic output of the private sector will have slipped to around £706.1bn – below the inflation adjusted £708.9bn it amounted to in the first year of Tony Blair’s government.
And by next year the private sector will have suffered a decade of zero growth. The figures are based on the assumption that the UK economy will contract by four to five per cent this year, as suggested by the influential Ernst & Young Item Club.
During the Tory governments of Margaret Thatcher and John Major the private sector grew by 66 per cent, while the public sector expanded by a far less dramatic 29 per cent.
But, since Labour was re-elected in 1997, the size of the public sector has ballooned by 63 per cent, swapping places with the private sector.
Prime Minister Gordon Brown has been slammed for excessive public spending. In 2008 to 2009 public spending rose to above 43 per cent of GDP, pushing government borrowing up to £200bn – the biggest structural budget deficit of all Western nations.