Economists warn Corbyn win could trigger recession

A LABOUR victory would lump the country with crippling debt and potentially spark a recession, economists have warned.

Jeremy Corbyn’s party has pledged to spend £250billion on infrastructure over the next ten years, increase corporation and income tax on high earners, and nationalise key industries.

Analysts at Capital Economics said net debt would be £100billion higher under his administration, while economists at Fathom Consultancy said: ‘A Corbyn-led government could deliver inflation, through a much weaker currency combined with a fiscal splurge. It could deliver a recession, too, through falling business confidence and collapsing asset prices.’

Separate research also suggested Mr Corbyn’s policies could increase the cost of government borrowing to above 3 per cent, compared to just above 1 per cent now.

It comes as a survey published today of medium-sized business found that only one in 14 back Mr Corbyn’s policies.

Of 800 British businesses polled by accountancy firm BDO, only 7 per cent said Labour policy would best help their businesses grow over the next year.

Nearly three-quarters (73 per cent) backed Tory policies instead, while 70 per cent said they thought the Conservatives would get the best deal for business when the UK leaves the European Union.