Britain is flat broke but what is Labour going to do about it?

Imagine for a moment that Labour wins the upcoming General Election. There, you see, that wasn’t so hard, was it?


Now imagine their first day in government. The new dawn. The better tomorrow… and the awful realisation that there really is no money to pay for it.


At the end of last year, Britain owed £2,685.6 billion. That is equivalent to almost 98 per cent of all the goods and services we produced in the year.


We borrowed nearly £8 billion in December alone and paid out more than £14 billion in interest on our debts. The country is flat broke.


They say that every citizen of Norway is a paper millionaire because governments there put their North Sea oil profits into a sovereign wealth fund for the benefit of future generations – the very opposite of what has happened here.


We have had years of austerity and if our politicians ventured outside London more often, they would find areas of deprivation where many people rely on food banks and there are few jobs and little hope. It is like living in an episode of Brassic.


Keir Starmer likes to burnish his working class credentials with tales of the pebbledashed semi he grew up in. But in reality, he is Sir Keir, distinguished barrister and former Director of Public Prosecutions, and enjoys all the privileges that go with that.


Rachel Reeves, who will be Chancellor of the Exchequer if Labour win, might come from Lewisham, but she graduated in Philosophy, Politics and Economics at New College, Oxford, gained a Master’s from LSE and worked at the Bank of England as an economist.


Clever people, then. And they will certainly know about the £2.7 trillion overdraft. The question is: What are they going to do about it?


There is a theory among political journalists that Labour have been very sparing with details of their policies because they don’t want the Tories to steal them. But does Starmer even know what they are? It’s hard to make promises when you are inheriting a mess like this.


There are plenty of reasons for how we got here. China’s Covid plague and Russia’s war have taken their toll on Western economies (yes, we’re not alone in being on our uppers). And inflation has wreaked havoc, too.


But we must take our share of the blame. Profligate leaders, whom we elected, have pissed our money up against the wall. Fat Cats light their cigars with our tenners. And now the cash has gone, wasted on bad decisions and vanity projects and doomed attempts to cling on to power.


We should still be a rich country but we’re not. And one reason is that our ways of doing things are stuck in the past. So here are five tips on how a new Labour Government can restore Britain’s fortunes.


Make everyone pay their way

That means you, Google, and you, Microsoft and you, Meta. While we mere mortals pay between 20 per cent and 45 per cent on our incomes, big tech pays … well, what it feels like paying. They talk it over with HMRC and then tell the taxmen what they are prepared to stump up.


In 2019, eight of these tech titans collectively avoided paying an estimated £1.5 billion in tax on their profits in the UK, according to a think tank called TaxWatch. They all bamboozle HMRC by claiming the money should be taxed somewhere else (where oddly, the rates are much lower).


Tech companies might be the most visible offenders but they are not the only ones.


Get a grip on infrastructure projects

When HS2 got the go-ahead in 2012, the project was meant to cost £37.2 billion. A tidy sum, but that was for a high-speed rail line all the way to Manchester and a spur going across to Leeds.


Rishi Sunak called time on this monstrous white elephant when cost overruns put the price up to £100 billion. Now the line will end in Birmingham and the important bit, the second leg to Manchester, has been scrapped. It will end up costing £250 million per kilometre of track.


Property prices, compensation for compulsory land purchases and protecting the environment have all added to the costs. So have gigantic salaries for those at the top – at one time the chief executive was on £750,000 a year. Changes of mind midstream by politicians have not helped either.


Many believe HS2 was unnecessary to start with. Now it is a very expensive waste of space. Someone must be to blame. Other countries do this kind of thing more cheaply. Shouldn’t we find out how?


Stop pretending that we are still a military power

We’re not. The British Army has halved in size since 1990. We have not had so few soldiers since the Napoleonic wars. With the danger from Putin’s Russia growing, one General suggested that we might have to bring back conscription.


Our Armed Forces now have about 152,000 personnel. A little over half of them are in the Army and the rest are split equally between the Royal Navy and the RAF. So why do we keep getting involved in conflicts that are none of our business? Do we need the practice? Are we just beholden to the Americans? Or is it because it lends our politicians a little of Lord Wellington’s swagger?


We need enough muscle to protect our country and its interests. So, yes, let’s recruit more troops – and let’s not be too woke about it. There’s nothing wrong with diversity but soldiers should be chosen solely on their ability to fight and endure.


And keep the ambition real. The grandiose plan for two Queen Elizabeth-class aircraft carriers together costing £7.6 billion have lumbered us with vessels that can barely make it out of Portsmouth harbour without breaking down. It’s a national embarrassment.


Force utilities and energy firms to do their jobs properly

Did you ever think that it would become routine for water companies to allow sewage to pour into our rivers and sea?


But it is. The companies have not invested sufficiently in new plant and technology and no longer have enough capacity at treatment plants.


In any case, the whole system dates back to 1856 when a decision was taken to let rainwater, waste water and sewage run down the same pipes – and we are stuck with it.


Water companies discharged raw sewage into rivers and the sea more than 300,000 times in 2022. Our trout streams stink. Wild swimmers are poisoned by effluent. Sea life around our coasts is harmed, sometimes irreparably.


The Government has a £56 billion plan to fix the overflows. But guess who is paying? We are, not the water companies. Some of them are loaded with such crippling debt that even if they raise funds from shareholders, the problem can only be fixed by imposing a levy on water bills.


The Environment Agency and Ofwat, the industry regulator, have failed miserably to keep a watch on the water companies. So, boot them out and find someone to do the job properly.


Meanwhile the boss of British Gas, Chris O’Shea, took home £4.5 million last year, which even he says is impossible to justify. British Gas profits last year rose tenfold to £751 million while the country struggled to afford to heat homes and cook food.


Crack down on illegal immigration

The outdated and broken asylum system costs £3.6billion a year and £6million a day in hotel accommodation. Back in June last year, Robert Jenrick, then Immigration Minister, told the Commons that this could rise to £11billion a year, or £32million a day, by the end of 2026.


Isn’t the key to solving this in the word illegal? Anyone who arrives here illegally in a small boat, or overstays their visa, should be told they must leave. If they refuse, they should be locked up. For those who genuinely need asylum – a very small proportion of would-be immigrants – there are legal ways to come here and claim it.


 Ray Davies was always one of my favourite musicians. A brilliant songwriter and frontman for The Kinks, he was the scratchy-voiced inspiration behind such classic hits as Waterloo Sunset and You Really Got me.


Jonathan Dean’s interview with Davies in the Sunday Times’s Culture magazine reminded me of the last time I saw him, oddly enough near Waterloo.


For some reason, virtually the whole of the Sunday Express staff was out for a midweek lunch at a restaurant in The Cut, not far from our Blackfriars office. We were talking business between guzzling buckets of Chardonnay.


The Showbiz Editor insisted that we needed more star interviews but bemoaned the fact that they were so hard to get nowadays. I pointed out that there was a big star sitting alone at the next table and she could almost just lean over and ask for a chat.


“Who is he?” she asked.


“Ray Davies.”


“Who’s he?”


I went back to my Chardonnay.


 I wonder if the 434-run defeat by India – an absolute spanking – has made the England cricket team reconsider Bazball, the devil-may-care creed they adopted after Kiwi Brendon McCullum took over as coach.


There’s nothing wrong with the philosophy: Play the game without fear, free to express yourself. But I suspect some of the players now see it as a free pass that absolves them from the responsibility of winning.


Skipper Ben Stokes said afterwards they did not want the match to “peter out to a boring draw”.  But that’s white ball thinking. This was a Test match, a test of skill, resilience and character. And England failed it.


They capitulated, from the moment in their first innings that Joe Root scooped the ball straight to second slip. One shocking, spineless dismissal after another.


Top sportsmen have to own their failures. You can’t say, “Oh, well, that’s just the way we play.”  I’d rather have watched a “boring draw” achieved with passion, pride and steely determination.


20 February 2024