Economic trends under Chancellor Brown, 2001 to 2005 Rise in the use of ‘stealth taxation’ Rise in general inflation Rapid fall in the value of pensions Rise in ‘skilled employment’ High numbers of ‘unskilled unemployment’ Development of a ‘client state’ Massive borrowing from foreign banks (national debt increase from £0.3 trillion in 2000 to £0.6 trillion in 2005) Rapid rise in consumerism.

Were more people in work? One of the government’s claims was that the number of people in employment in Britain grew during the Blair years. In 1997 there were 26.6 million people in work, this had risen to 29.1 million by 2007. However, this growth was mostly middle-aged skilled workers. Unemployment remained high in young, unemployed workers. In 2007 there were 5.4 million people (16 – 30) who had never had a job and were on unemployment votes. By 2007, most people (7 million) were working in the public sector. This created a ‘client state’ (25% of all workers were employed b the state)

Was there more borrowing? The increase in government expenditure on the public sector, in areas such as the NHS, welfare services and education, could not be met entirely from taxation revenues. Over the period of his chancellorship, Golden Brown had borrowed heavily from foreign banks. The government’s justification was that it was a way of improving public services House buying and retail sales increased markedly. Buying of the products of new technologies, such as personal computers and mobile phones, showed great willingness among consumers to spend. The plastic ‘credit card’ became a symbol of noughties Britain.

Details Impact Brown taxed pensions Brown used various ‘stealth taxes’ to maintain his promise not to raise tax. Money was borrowed from foreign banks 50% of British gold reserves were sold off Employment was kept high through government spending