Labour inherited an economy with many weaknesses. We took action to lock in low inflation and to cut government debt; entrenching in law the golden rule – that over the economic cycle the government should only borrow to invest.
We made the Bank of England independent to ensure that interest rates decisions are taken in the best long-term interests of the economy.
As a result the deficit has been eliminated and inflation is at its lowest level for 30 years.
We introduced strong competition laws to stimulate innovation. We started to tackle standards in schools and introduced the New Deal to get the long term unemployed back to work.
Business investment is at its highest level for 40 years; productivity is up and inward investment is at record levels.
OECD figures show we have lower income taxes, business taxes and VAT rates than any other European economy. Corporation tax is at its lowest ever level and capital gains tax has been cut.
The economic stability Labour has achieved now allows us to build for the future on firm foundations; to reverse the legacy of under-investment. For every pound of public expenditure just 17p goes to fund debt interest, unemployment benefit and social security spending, compared to 42p under the Tories.
But there is a lot more work to do. We need to raise growth and close the productivity gap with our international competitors. We need to remove obstacles to enterprise and entrepreneurship in all parts of the country, to increase competition and raise educational standards for all.
These are priorities for a second term.
The alternative is a return to boom and bust with a Tory government.
The Tories who say they will cut taxes, cut spending and at the same time will not cut any public service. Any accountant knows this is just nonsense.
Labour will take no risks with the economy. We shall maintain the policies necessary to deliver the economic stability that is so important to business.
- Stephen Byers is the secretary of state for trade and industry