The government's policy of slow fiscal consolidation has failed
“The government’s lacklustre attempts to cut the deficit are reflected in today’s dismal ONS figures. The latest borrowing figures demonstrate that the policy of slow fiscal consolidation led by tax rises has been a mistake. There needs to be a greater effort to reduce government spending – including in ring-fenced areas – in order to reduce borrowing more rapidly and create room for tax cuts.
“Calls from the opposition and the IMF to increase planned government borrowing would simply exacerbate the problem. The experience of Japan demonstrates that simply accumulating more debt will not return a country to growth – it simply delays the return to growth. With a public debt now at £1.2 trillion, it is clear we urgently need a more radical plan to boost our flatlining economy.”
Notes to editors:
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