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Wednesday, 28 April 2010

Election Update - You Get What You Pay For

The IFS’s recent analysis of the party Manifestos and the tax rises and public sector spending cuts that will be required to achieve the parties’ commitments, all demonstrate one thing - you get what you pay for.

The IFS estimate that the Liberal Democrats would need to raise an additional £760 in taxes per household each year to meet its plans, Labour £610 and the Conservatives £390. Not surprising then that the parties’ plans require public sector spending cuts of £47bn, £51bn and £64bn a year respectively. What is necessary is for the next Government to layout a credible plan to address the deficit; the question is “How?”
The blend of tax rises and cuts will affect us all in different ways, individuals and businesses alike. Construction firms dependent on public sector contracts might want to see spending protected in certain areas, manufacturers may want to see lower taxes that enable them to retain money for investment.

Irrespective of the occupant of No.10 on May 7th, majority, minority or coalition government, the nation will get what it is prepared to pay for, borrowing is simply not an option. With this in mind the electorate needs clear details upon which to make an informed decision on which way to vote. What is clear is that the parties have been unclear – so roll on the final Leaders’ Debate tomorrow. As the leaders slog it out in the deciding match we need substance, or will style win through once again?

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