Gordon Brown’s decision to fight this year’s general election as a battle between cuts and investment has been blasted by Tony Blair.
He says Brown’s “plan for the banks was right” but he later “bought completely the socalled Keynesian ’state is back in fashion’ thesis.”
Blair says: “The top rate of tax was put up to 50 per cent. In 2010, the hike in National Insurance was the route taken to tackle the deficit; and the decision was taken to fight on the grounds of cuts versus investment. We should have taken a New Labour way out of the economic crisis: kept direct tax rates competitive, had a gradual rise in VAT and other indirect taxes to close the deficit, and used the crisis to push further and faster on reform”.
He says: “Tellingly, we lost business. This was crucial. When the Tories brought out 30 or so chief executives who were against the National Insurance rise, I knew the game was up.”