Chancellor George Osborne said he was determined to see Britain through the financial crisis as he outlined his plans to boost the stuttering economy in his annual Autumn Statement – with the latest gloomy forecasts suggesting the country is again teetering on the edge of recession.
He was forced to admit that GDP has been revised down to 0.9% this year and 0.7% next year.
He said debt was not coming down as quickly as hoped, “but we are set to meet our targets”.
He also urged union leaders to call off tomorrow’s “damaging” public sector strikes, and announced further restraint on public sector pay of 1%.
Help for small businesses suffering from the credit squeese was addressed through a string of measures including an enterprise finance guarantee scheme and a credit easing scheme introduced with ceiling of £40bn.
No government had ever attempted anything like this before, he said.
He also announced help for science and innovation, small exporters and an extra £1bn for the Regional Growth Fund in England.
He also announced help for science and innovation, small exporters and an extra £1bn for the Regional Growth Fund in England.
He closed his Autumn Statement by saying: “All this takes Britain in the right direction”. He said he was not offering a quick fix but leadership for tough times.
Following the Chancellor’s 47-minute speech, Shadow Chancellor Ed Balls went on the attack in the Commons, saying the government had cut too deep, too fast with the Chancellor taking a “reckless gamble”.
“We have had all of the pain and none of the gain,” said Mr Balls. “All we get are excuses, blaming everyone but himself.”
Forecasts by a wide range of economic and business organisations have been downgraded a number of times this year – each pointing to almost non-existent growth.
The Chancellor will also have to admit the black hole in the public finances are worse than early thought, with analysts penciling in an increase of around £30bn, meaning the government will need to impose austerity measures on the public sector longer than expected and into the next Parliament.
Business lobbying groups have urged the Chancellor to take urgent measures to restore confidence and stimulate growth and in a series of high-profile interviews over the past few days Mr Osborne has insisted he is listening and ready to announce a stream of initiatives to get the economy moving, create jobs – particularly for hard-pressed young people – and improve the country’s creaking infrastructure.
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