The Labour Government has been in office for a little over a year now, and already it is the same pattern we’ve seen from previous Labour administrations. They have spent more, borrowed more, and taxed more.
The results of this are now becoming painfully obvious. Labour has created a vicious circle where increased tax and borrowing stifle economic growth and create rising unemployment.
In March, the Office for Budget Responsibility (OBR) reported that taxes are set to rise from 35.3% of gross domestic product (GDP) to a historic high of 37.7% by 2027–28. The Government is taking a larger share of earnings. Tax receipts are also up.
Yet Government borrowing continues to spiral. According to the Office for National Statistics (ONS), borrowing in August hit the highest level for that month in five years at £18bn, and higher than analysts had predicted.
Before the election, Labour promised to kickstart economic growth. They claimed they would deliver “the most pro-growth, pro-business Treasury this country has ever seen.”
Yet the reality has been the opposite. This year the OBR, the OECD, and the Bank of England have downgraded the UK’s growth forecasts under Labour.
Research suggests wealth may be leaving the UK, with higher taxpayers moving as a result of the Government’s higher taxes.
Businesses are also being squeezed. Labour’s increase in employer National Insurance contributions has made employing people more expensive for businesses. This has led to increased unemployment and fewer vacancies. The national rate of unemployment has risen, which the Conservatives warned would be the result. Here in Wokingham Borough, more residents are claiming unemployment-related benefits.
The OECD now predicts the UK will have the highest rate of inflation among the G7 group of advanced economies, currently 3.8%, up from 2.5% last year. It’s predicted only Putin’s Russia and Brazil are expected to have higher inflation than Britain under Labour.
The Bank of England has directly linked rising inflation to hiking employers’ National Insurance. This tax has led businesses to cut jobs, lower wages, and breaks Labour’s promise not to raise taxes. It also directly affects people across the country and in our Borough. You are now paying for the Government’s mismanagement with prices rising even faster in the shops.
The Liberal Democrats offer no real alternative. At their party conference, Ed Davey refused to rule out a coalition propping up Labour after the next election, and some members even spoke in support of higher taxes on wealth, property, private schools, and scrapping the pensions triple lock.
Locally, Wokingham Borough is facing its own crisis of Labour’s making. The Government has already cut £1 million from the Council’s funding this year, compared to the £2.3 million increase provided by the previous Conservative Government in 2024. Yet over the next three years, Wokingham stands to lose nearly £50 million more. Wokingham will lose more of its locally paid business rates and will see a steep reduction in grants and funding from the Government. The challenge is unprecedented.
Wherever you turn, the Labour Government is making things worse for individuals, families, and businesses. All the while, Government Ministers continue pretending that it’s all fine. Just last week, Sir Keir Starmer posted on social media that Labour “are making change happen for working people”. He failed to mention that the change is for the worse.
At a local level, Conservatives will continue to fight for changes for the funding settlement for our Council, and we’re arguing strongly for an end to Labour’s doom spiral of never-ending tax rises. The British people need a break from Labour’s broken economics.
By Cllr Pauline Jorgensen, leader of Wokingham Conservatives
