Private sector investment fallen by £25bn per year under Tories, says Labour
Private sector investment in the UK has fallen by £25 billion per year since the Conservatives came to power in 2010, according to an analysis by the Labour Party.
It said annual business investment was 10% higher under Labour, equivalent to £25 billion more investment each year in today’s prices.
Sir Keir Starmer’s party said the average annual private investment as a percentage of GDP, a measure of the health of an economy, was 11.1% during the New Labour years.
That has since slipped to less than 10%, Labour said.
The findings are based on Labour analysis of international investment comparisons compiled by the Institute for Public Policy Research (IPPR), a left-leaning think tank, using data from the Organisation for Economic Co-operation and Development.
The IPPR, in the report published in September, said UK business investment was the lowest in the G7, a group which includes the US, Canada and Germany, after corporation tax was cut to 19%.
It has since been raised to 25%, with the increase coming into place in April.
Jonathan Reynolds, the shadow business secretary, said: “We cannot go on having the lowest levels of business investment in the G7.
“Labour will turn this around as part of our mission to secure the highest sustained growth in the G7.
“We know what it takes to attract investment to this country. You need a stable and credible government giving businesses the room they need to grow, creating jobs and goods for British workers.”
Labour accused the Tories of economic mismanagement in the past 13 years, highlighting former chancellor Kwasi Kwarteng’s disastrous mini-budget 11 months ago that saw the value of the pound tumble and sent mortgage rates spiralling.
The political fallout led to Liz Truss resigning weeks later, making her the shortest-lived prime minister in modern British political history.
In its response, the Tory Party looked to deflect from the business investment record on its watch, instead focusing on foreign direct investment levels.
A party spokesman said: “Labour are always up for talking Britain down.
“In fact, foreign direct investment in the UK is at its highest ever level and has increased over 160% since Labour were last in office.
“This investment delivers more jobs per project than Germany or France.
“The UK now ranks in the top three as a priority investment destination for CEOs – we will continue to attract new investment to grow our economy and fund our public services.”
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