UK On Track for Worst Growth in 100 Years BUT is it all Labour or the Conservatives Fault?

Headlines suggest the UK is on track to deliver its worst average 10 year growth period in 100 years in the 2020’s (article published in a traditionally Conservative newspaper).  Equally, you will see headlines for 'Labour' newspapers blaming the Conservatives for everything.

So we have a few years to go yet, but already GDP growth has fallen to just 0.1% pa in the 3 months to November 2025.  Forecasts suggest that the UK may only growth by 1.1% overall in 10 years, and only in the 1920s was it worse at 0.8% pa overall. 

You know what that led to?  The Great Depression in the 1930s and that then to World War II (as Germany suffered more than most in the Depression due to excessive World War I reparation penalties).

Who’s to Blame?  We take a deep dive into the figures …

The Labour Government blames the previous Conservative Government and the now, in opposition, Conservative Party blames the Labour Government.

Reality, Labour spends on public sector and benefit improvements thereby creating debt (after Conservative cutbacks and austerity) to stimulate the economy and taxes the private sector ever higher to raise revenue.  The Conservatives reduce public spending using austerity to reduce debt whilst encouraging economic growth in the private sector to improve wages, private entreprise and higher tax revenue as a result.  In living memory only Margaret Thatcher has managed to move the UK to an international trade surplus and spend 5% of GDP on defence but at some cost.

When Labour gets into power, it tries to deal with years of austerity and neglect on public services with more spending but borrows too much and when the Conservatives get into power, they cut benefits, pay off public sector debt and try to grow the private sector.  So who is right?

They Are Both Wrong – We Need Balance

We suggest neither Labour or Conservative policies are totally right.  Both appear to cancel each other out.  So we suggest there needs balance between the two doctrines.

• We cannot have 9m people (of working age) claiming benefits, with roughly half of those not actively required to seek work.
• Neither can we have public sector spending cuts resulting in ambulances queing at hospitals as there are not enough beds, an army at its smallest in 200 years, and prisoners being released early as there are not enough cells but the ‘fat cats’ get richer and richer.

Looking at GDP since World War II Austerity End and General Elections (1949 onwards)

The Conservatives have been in government for 49 years and Labour in government for 28 years.  This tells us that the public generally likes the opportunity to work, develop business and not have huge benefits bills.  Roughly speaking, of those years, under the Conservatives, GDP was positive (i.e. the economy grew) for 53% of their time in power and under Labour, GDP was positive for 50% of their time in power.  The figures are skewed towards Labour having a greater % of +ive GDP years and not Conservative when we remove ‘election years’, the period of transition from one doctrine to another.  This is because the Conservatives usually battle with a public sector debt 'tail' when they take over from Labour and Labour usually benefits from a private sector growth policy 'tail' when they take over from the Conservatives.

Source of Data:  Office for National Statistics “Gross Domestic Product: Year on Year growth” https://www.ons.gov.uk/economy/grossdomesticproductgdp/timeseries/ihyp/pn2

The reality is that at 53% +ive GDP years under the Conservatives and 50% +ive GDP years under Labour, doctrines are broadly even whereas if a combination of both doctrines where used (as part of a more proportional respresenation government), as in Germany, the UK economy would consistently grow in even more years than contract, albeit at a lower/steadier rate, as has been the case in Germany since 1949, if each government changeover did not have to deal with the extremes of socialism or capitalism from their predecessors.