Coalition at half time
Harold Wilson said “a week is a long time in politics.” That was before 24 hour TV news, the internet and twitter. Events can now spin out of control at political light speed. But the older adage of tempus fugit still applies. It’s now two and a half years since the formation of the Conservative-Liberal Democrat Coalition Government. What has changed while time has flown?
Ironically, the most beneficial impact has been stability, which by its very nature is not immediately obvious. But if you think back to May 2010, the country was in a terrible economic mess. The economy had shrunk by 7% and the outgoing government was borrowing a quarter of its expenditure. It was the worst position of any major country. The new government needed to borrow hundreds of millions every day just to keep afloat. The international markets would charge more for that borrowing if they lacked confidence in the Coalition’s determination to get Britain back on track.
Now at the half way mark of the Coalition we know that the markets have maintained the UK’s triple A rating, the gold standard for borrowing. We can borrow at about the same rate as Germany, Europe’s soundest economy. This is an enormous achievement, when other European countries are being buffeted by crises and crippled by high borrowing costs. Keeping down our borrowing rate releases more money for health and education spending and cushions the impact of spending cuts elsewhere.
Our economy is healing but there is still some way to go. Unemployment is falling in Bristol and across the country. Our jobless rate is lower than the Eurozone and the US. Output is growing but at a low rate. Interest rates for businesses and households are at a record low. Everyone in Bristol with a mortgage sees a big boost to their net income as a result. Net incomes for those in work have also been increased as a result of the Coalition increasing the tax free pay threshold from £6,500 towards our goal of £10,000. This tax cut for millions of people was the top Liberal Democrat policy for which I campaigned in Bristol West at the last election.
Aside from stabilising the economy and public finances the Coalition has also brought in a new style of politics. Two parties that are long term rivals and who disagree on many issues are co-operating in the national interest. I am not comfortable with everything the Coalition has done but Tory MPs are also upset about that some of their policies have been blocked. It is a new style of politics in London and now we are seeing something similar in Bristol with our new Mayor. The public want to see us working together in the interests of Bristol and Britain.
[NOTE – this was an article written for the Bristol Post]