George Osborne has insisted that there would be no U-turn on its deficit reduction plan as he attacked the “siren voices” urging the government to abandon austerity reports The Guardian.
Speaking at an investment conference in London, the chancellor admitted that the 0.7 per cent plunge in growth in the three months to June was “disappointing” but insisted that the Treasury would stick to the course set two years ago.
“You will hear those arguing that we should abandon our plan and spend and borrow our way out of debt,” Osborne said in response to widespread calls for the coalition to do more to lift Britain out of double-dip recession.
“You hear that argument again today. These are the siren voices luring Britain onto the rock. We won’t go there.”
The chancellor said that at the time of the 2010 election, Britain had to pay the same interest rates on its long-term borrowing as Spain and Italy. “Today, their cost of borrowing is more than 6 per cent and ours is 1.5 per cent. That market confidence and those ultra-low interest rates are precious assets – hard won and easily squandered.”
After a tough four months since his badly received budget, Osborne argued that he had the right three-pronged strategy – dealing with Britain’s debts, a pro-business tax regime and supply-side reforms to make the economy more productive.
“A credible plan to deal with our debts is an anchor of stability and a prerequisite of recovery,” the chancellor said. “We have that credible plan – and we’re sticking to it. That gives confidence to investors looking at the UK.”