How do we get Britain’s economy growing again? Watch the STRICTLY BUSINESS debate on bringing back growth

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By peacetime standards, the UK national debt, accumulated over years of public borrowing, is too high.

However, this is no excuse for a Tory administration to abandon efforts to improve our national productivity and economic growth.

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If Rishi Sunak and his Chancellor Jeremy Hunt don’t recognize that high taxes discourage business investment and discourage workers from working harder, they risk putting the country in the doom of ever-increasing taxes as it struggles to control the public debt.

In an almost unheard section of his fall statement in which he referred to the agony for business and entrepreneurship by canceling promises to cut corporate tax and buying into the Labor and Liberal Democrat agenda over windfall taxes on the oil and gas industry, Hunt spoke of his goal of making the UK a new “Silicon Valley”. But the only way to do this is to follow a growth program.

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Nobody wants a repeat of last year’s September Trussonomics experiment. The mini-budget’s tax-cut goals were commendable, but the implementation was amateurish. This gave traders in the financial markets an excellent opportunity to bet against the pound and the price of British government stocks.

The truth is that the underlying financial situation in Britain is infinitely better than most of our competitors, with the exception of Germany.

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Take the deplorable state of the US economy. President Joe Biden’s Treasury Secretary Janet Yellen, who had the audacity to lecture Kwarteng on unfunded tax cuts, presided over a massive spending spree that brought the federal government to the brink of shutting down.

Last month, it hit a statutory debt ceiling of $31.4 trillion (£25 trillion), or 122% of the all-powerful American economy’s total output.

That’s ten times the UK’s £2.5 trillion debt, or 87 percent of national output, according to the International Monetary Fund.

Meanwhile, France is under the guns of the IMF because of the level of debt, which has risen to 112% of GDP.

Despite this, Sunak and Hunt agreed with the view that Britain is a kind of budget pariah with no room to maneuver on taxes. This is a duck that should be banished from public discourse.

The latest forecasts of the Bank of England on GDP are not very readable.

Take the recent December public finance data, which the Financial Times published under the headline: “December Loans Double to Record High.” Detailing the numbers shows a completely different story.

A loan is the difference between two very large numbers: what the government spends in any given month and what it collects in taxes and other fees. But the statistics are distorted by significant isolated cases.

In the case of December, the result was skewed by the ‘energy price guarantee’, where payments and subsidies to help households and businesses cope with rising fuel bills amount to £6.7bn.

The £17.3bn government debt rate bill is also misleading. It is based on high interest rates, which are likely to fall sharply as inflation declines this year and next.

In other words, the budget crisis is much less serious than it is portrayed.

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