Tuesday, January 26

It's almost time for kissing babies


This billboard appeared outside our office this month. It’s one of almost a thousand posted across the country at an estimated cost of £400,000. Each shows David Cameron, leader of the Conservative party, looking rather presidential and ever so slightly air-brushed. If opinion polls are to be believed, he’ll soon be Britain’s next Prime Minister. The nation’s general election campaign is clearly underway, well before a polling date is announced.

The British Parliament sits for a maximum of five years, after which it is dissolved and a general election is held. Much like Australia and New Zealand, the prime minister has the power to choose the election’s date. Once he (or she) calls on the Queen to dissolve parliament an election must be held 17 working days later. This year a general election must be held no later than June 3, 2010, seeking voter endorsement for 646 MPs.

We’re set for an interesting time in politics. The Conservative Party has been in opposition for 13 years. It lost power in 1997 after being soundly trounced by Labour’s largest ever parliamentary majority. How times have changed. Most polls currently show the Conservatives rating ten to 16 percentage points ahead of Labour. Worse still, the Labour Party is still saddled by enormous debts it clocked up during the last election.

At last count, Labour owed at least £11.5 million. As a result, this year’s campaign budget has been capped at £8 million. Contrast this with the Conservative Party, with debts of almost £5 million. It expects to raise a staggering £25 million for the next campaign, effectively outspending Labour three to one. Both parties spent similar amounts during the last election. By law, the main parties cannot spend more than £18 million on the campaign. However, individual candidates can spend up to £40,000 each this year, thus swelling the overall spend.

As the current billboard bitz suggests, the nation’s burgeoning public debt will be a key election issue. The Government has attempted to kick-start the economy by boosting spending. Funding this stimulus has resulted in it borrowing money a rate of more than £50 million per day. This strategy will be under intense scrutiny by the opposition. It claims that savage cuts in public sector funding must start sooner rather than later to bring national debt back under control.

No doubt, Prime Minister Gordon Brown is praying for good news tomorrow when the Office for National Statistics releases its economic data on 2009’s last three months. Commentators expect the nation’s Gross Domestic Product (GDP) to show growth for the first time in 18 months, thereby officially ending the recession. Labour will be praying hard for plenty more good news in the months ahead.

UPDATE - January 26
We're officially out of recession. The UK economy grew a meager 0.1% in the final quarter of 2009. One tenth of one percent doesn't sound like much of a recovery! This result means that the 12-month economic decline in 2009 hit a record-breaking 4.8%. It's been a tough year.

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