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Do politics and economic strategies really mix?

As we mentioned in one of our earlier articles, the UK government has yet to set out a credible plan for reducing the UK budget deficit which is now at a high of £178 billion. One obvious reason why the government has not been as open about the future as it could be is simply because we are nearing a general election and the government needs the support of Labour voters across the UK.

While would be wrong to suggest that the Labour Party, the current UK government, has been the only serving government in history to put politics before the economy, it does have the potential to extend the recession and the hardship felt by many in the UK. Indeed we have seen a major reduction in the value of sterling on the money markets which will have an impact upon the UK economy in the short to medium term. However, will the bigger picture be any different after the general election?

Unfortunately for UK taxpayers, no matter who wins the next general election we will see a significant increase in taxes and we will see a significant reduction in public sector investment. There is no way around these two strategies for the future because ultimately there is a need to reduce the budget deficit and also to pay down the ever-growing UK debt mountain.

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