Statistics about economic growth and GDP are banded around a lot. Most of us find it hard to instantly identify truth and lies. I was helped recently by a pundit who pointed out that GDP is a measure of economic activity. If you spend an hour working and make enough money to go to a prostitute or buy drugs that is economic activity. If you spend the hour doing your neighbour’s garden for nowt, it isn’t.
In the midst of all this a piece by Jonty Bloom in The New European caught my eye. He pointed out that the IPPR (Institute for Public Policy Research) reports that the UK has been bottom of the G7 for economic investment for 24 of the last 30 years.
The only way to get the money for investment is borrowing or tax increases. If we decide we cannot afford them we fall further behind and become less likely to afford them. As an example of this short-termism, the cancelling of HS2, when we were well on the way, makes it harder for us to eventually do it. Governments will always be tempted to take the money now rather than let a future government get the advantage.
The IPPR want to be able to report on necessary investment by making benchmarks. These, at the beginning of the life of a government, would establish the amount of investment necessary to meet the government’s stated goals. They could then be challenged and questioned against them. If investment spending was slashed the consequences for long-term goals would be made clear.
This, sadly, is not the sort of conversation we have during election campaigns. It should be.
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