When I read Labour’s economic strategy at the beginning of the campaign, I was struck by their poor understanding of the economy.

My concern at Labour’s competence on economic and financial issues was proved right by the latest propaganda put out by Andy Kerr.

Now that Wendy Alexander has gone, Andy hopes to be the Finance Minister in a future Labour Government.

Yet, a four-page newspaper put out in his name demonstrates a frightening level of financial and economic illiteracy.

The following are just some of the best / worst examples.


A piece on knife crime claims that 1,170 victims of knife crime take up 3,500 ‘bed days’ each year in NHS hospitals – at a cost of £3 billion to the health budget.  According to Labour’s figures:

The NHS spends over a quarter of its budget (over £11 billion) dealing with the victims of knife crime
A single bed day in an NHS hospital costs over £850,000
Each victim of knife crime admitted to hospital costs over £2.5 million

These figures are nonsense to an incredible degree. The real cost of an occupied acute bed in the NHS is under £600 per day. Where Andy got the figure of £3 billion from is anybody’s guess; but, on the same issue, Iain Gray claims the total cost of knife crime to the NHS is £500 million.

As these are the two people who are supposed to be producing a costed manifesto for Labour for the Scottish Parliament elections, you would think that, by now, they would be in agreement on something so fundamental to that manifesto.


On housing, Andy demonstrates a basic lack of understanding of what has happened to the housing market in Scotland. His newspaper says:

“Recently released figures show the lowest number of new homes under construction since 1981 – including social housing. Cuts to Housing Association Grants, which help fund the construction of affordable homes, are being blamed for the shocking statistics.”

I don’t know about the reason for looking back to1981, but if we look back to 2003/04 the figures for new house building in Scotland are as follows:

New house starts 2003 - 2010

New house starts 2003 - 2010

As these figures show, the dramatic fall in new house building has taken place in the private sector following the banking crisis. In case Andy missed it, this resulted in private new house building plummeting as banks and building societies withdrew funds from the mortgage market and people, fearful of their jobs, stopped taking on new commitments.

The figures also show that, despite facing cuts in their budget, the Scottish Government maintained activity in the social sector to provide affordable homes, but even this sector was hit as schemes of mixed private and social housing faced delays.

The misleading analysis is intended to shift the focus for the collapse in the housing market from the UK Labour Government, which oversaw the banking crisis, to the Scottish Government, which had to cope with Labour’s mess.

The problem is that any policy based on this analysis is doomed to failure, letting the people of Scotland down, and probably wasting millions of pounds in the process; but then, we don’t expect anything else from Labour.


Helping young people into the Labour Market is an absolute top priority.

That is why the Scottish Government brought forward a budget to deliver 25,000 apprenticeships in 2011 / 12 and also reached agreement with colleges and universities to maintain student numbers. Under Andy’s direction as Finance Spokesman, Labour failed to support the budget.

As with housing, any government can only deliver part of the jobs solution for young people. In Scotland, an apprenticeship means being taken on by an employer. So, to deliver more apprenticeships, the government needs to recruit employers willing to take on new labour.

Throughout the recession, Skills Development Scotland, on behalf of the Scottish Government, has done a great job in growing the apprenticeship programme. But, no government controls the employment policies of private firms or even of other parts of the public sector, such as local authorities.

So, Labour’s claim, that it can guarantee an apprenticeship for every young person who wants one, is a cynical attempt to mislead young people desperate to find their first job among the economic mess created by the Labour and ConDem UK governments.

In an interview on STV, Iain Gray said, “It is up to politicians and governments to make promises which both they can keep and which they then go on to keep…”.

It appears this message has not got through to Andy Kerr, whose use of flawed figures and misleading analysis is unfortunately matched by his willingness to make undeliverable promises.

The content of this campaign newspaper is so misleading that it needs to be withdrawn, or corrections published in later Labour leaflets.

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