- NATIONAL DEFICIT AND DEBT
The recession led to a sharp drop in tax receipts, while bank bailouts, stimulus packages, and rising unemployment stretched public spending, greatly increasing the national deficit – Conservatives argued that Labour had overspent during the years of pre-crash growth, and that if there had not been a deficit prior to the crash the nation’s finances would have been better prepared for the economic downturn.
They began to argue that the deficit had to be addressed quickly in order to protect the UK’s credit rating, to reassure lenders that the UK was taking steps to repay its debts, and to tackle the rapidly increasing national debt.
In 2010, the party pledged to eliminate the deficit by 2015, criticising Labour’s pledge to only halve the deficit in that time.
Under Cameron, the party continued to argue that the best way to address the deficit was to cut public spending, particularly on welfare, and, at the same time, cut taxes in order to encourage hard work and investment, in order to boost tax receipts.
May and Chancellor Phillip Hammond claimed to take a different approach – would be borrowing to “invest in the things that matter”, in particular new homes and infrastructure, and would no longer be aiming for Cameron’s target of eliminating the deficit by 2020.
- TAXATION AND WELFARE
- EU
- CONSTITUTIONAL REFORM