Stephen Timms last week in the House of Commons confronted the Chancellor of the Exchequer, George Osborne, about the failure to meet the predicted growth figures over the last 6 months.
He asked the Chancellor “A year ago the Office for Budget Responsibility was projecting growth in the UK economy of 2.6% this year. Now the forecast is down to 1.7%. What has gone wrong?” In his answer, Mr Osborne provoked laughter when he attempted to blame “global headwinds”.
Two weeks ago the ONS announced that the economy had grown 0.5% in the first quarter of 2011 and that the economy had not grown at all in the last six months.
Mr Timms later said “The problem is that the Government’s policy is restricting growth. That is why unemployment is so stubbornly high, and youth unemployment is rising. Of course the deficit needs to be addressed, but, by cutting too far and too fast, the Government is making matters worse."
“The Chancellor says ‘global headwinds’ are the problem, but this is simply not the case. The IMF’s forecast of economic growth in the advanced economies as a whole this year is the same now as it was a year ago. However, the UK’s forecast has been downgraded from 2.5% to 1.7%. The problem is not ‘global headwinds’ but George Osborne’s misjudgements.”