1. nef (the new economics foundation) “Excessive government borrowing got us into this mess” Charlie Cooper, The Independent Richard Exell, TUC

2. nef (the new economics foundation) In the wild “As we've heard from Miliband over recent days, [Labour] believe in more spending, more borrowing – more of the things that got us into this mess in the first place.” – David Cameron, May 2013

3. nef (the new economics foundation) The reality The last government did not borrow excessively It was the banking crisis that caused the recession The increase in the deficit since the start of the recession has reduced the severity of the downturn

4. nef (the new economics foundation) The reality The last government did not borrow excessively Source: Bank of England Financial Stability Report, June 2012

5. nef (the new economics foundation) The reality It was the banking crisis that caused the recession Source: OBR http://bit.ly/13CIVwk

6. nef (the new economics foundation) The reality The increase in the deficit from 2008 – 2010 was a result of higher social security payments and lower tax revenues from reduced economic activity, combined with some stimulus measures (for example, cutting VAT for a year) Far from making the recession worse, this increase in the deficit helped to maintain economic activity and reduced the severity of the downturn The increase in the deficit since the start of the recession has reduced the severity of the downturn

7. nef (the new economics foundation) The irony is that Labour gets a lot of criticism for a crime of which they are innocent (spending too much) and hardly any at all for one of which they are guilty (not regulating the banks)

8. nef (the new economics foundation) In summary The last government did not borrow excessively It was the banking crisis that caused the recession The increase in the deficit since the start of the recession has reduced the severity of the downturn