Government's economic credibility in 'tatters'

25 May 2011

The Tory-led government's economic credibility is in 'tatters' as official figures show zero growth but a record increase in borrowing.

The latest ONS figures today (25 May) show the UK's economy failed to show significant growth over the past two quarters, while yesterday official figures also from the ONS revealed that last month's borrowing figures were the highest ever recorded for the month of April.

Today the OECD also said the sluggishness of the UK economy will feed through into higher unemployment and warned interest rates would have to rise.

Len McCluskey, Unite general secretary, said: "The government's economic credibility is in tatters but sadly it's working people who are paying the price. George Osborne has staked his reputation on cutting the deficit, but Tory-led economic policies are in such disarray he has actually managed to deliver a record increase in borrowing. The chancellor also claimed his policies would boost the private sector, but growth is flat and business investment has fallen seven per-cent. George Osborne - and the coalition government - is failing miserably on every count.

"The coalition has now been in power for one year and Britain's economy is in a worse state now than it was when they entered government and there are no signs of improvement. It is time for the coalition government and deficit hawks in the CBI and IoD to look at alternatives which boost the economy rather than leave Britain injured on the sidelines.

"Amazingly, the OECD is predicting a sluggish UK economy but is recommending more of the same measures from the government which is failing Britain and the rest of Europe. It is time to think differently and act differently. Just because it hurts does not mean it will work."

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