UK economy ‘back from the abyss’

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Published: Friday 20th March 2015 by The News Editor

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The coalition Government has brought Britain back from the “abyss of financial oblivion”, Communities Secretary Eric Pickles said today.

It had stood its ground in the face of “ferocious economic headwinds” from the Eurozone and stepped back from the “cliff face”, he added.

Speaking in the third day of the Budget debate in the Commons, the Tory frontbencher said: ” This Government has put Britain on the road to economic recovery.

“In 2010, our country was on the cliff”s edge, staring into the abyss of financial oblivion. The economy was stalling, unemployment was rising and the national debt was spiralling out of control.

“From day one, pulling the country back on to safer, more secure ground was our top priority.

“Five years later, it is a different story. We have stepped back from the cliff edge, our growth rate is faster than anywhere in the G7, our job creation is the envy of the developed world.

“It all confirms the old Yorkshire proverb – ‘where there is muck there is brass’ – and boy, did Labour leave us a lot of muck.

“We have only managed to start cleaning up Labour’s mess because we stuck to our long-term economic plan.

“We stood our ground when ferocious economic headwinds blew in from the Eurozone.

“We didn’t listen to those who said the only solution was more borrowing and more spending beyond our means.

“Nobody now talks about plan B. We stood firm and today the deficit has been brought down by a half as a result. Living standards are rising and a record number of people have found jobs.”

Labour’s Mike Gapes (Ilford South) branded the Government a “total failure”, even judged by its own aims on bringing down the deficit.

But Mr Pickles hit back: “This is a compassionate Government … had we gone any faster, it would have had social consequences.”

He went on: “Nowhere is generating jobs faster than the North West. Yorkshire is creating more jobs than the whole of France.

“Our French friends may have given us liberte, fraternite and egalite , but my own home county is providing creativity, industry and Yorkshire tea.”

He also hailed the Government’s record on housing, saying it was the first since the 1980s to end its term with a larger stock of affordable homes.

Shadow communities secretary Hilary Benn slammed Mr Pickles for “re-writing economic history” and said Tories hold on to their “long-term economic plan” slogan as a comfort blanket because the Government has failed.

Mr Benn said that before the global recession of 2008, the Labour government had debt and borrowing lower and its public spending plans were supported by David Cameron.

The Labour frontbencher said: “I suspect that the repetition is more of a comfort blanket for members opposite because the thing they can’t understand is why, given this wonderful alleged success that we’ve heard about today, why in the opinion polls so close to the general election they are neck and neck.

“The reason why that is the case is because people know that they are not better off under this Government and the Government has failed.

“And I would just say this about the attempts to re-write economic history, because it is important to place on the record that the charge that somehow the last Labour government brought about the global economic recession, which I have heard more than enough times from the benches opposite is not to true.

“Fact – prior to the global economic crash debt and borrowing were lower, investment in public services was matched by the pledge of the then leader of the Opposition, now the Prime Minister, who said we back Labour’s spending plans pound for pound.

“And yes the action that we rightly took against the advice of the then Opposition, kept people in their homes, kept them in their jobs, and not a single person lost a penny in their savings.

“I am still waiting all these years after the event for someone to explain to the House how it was that the decisions taken by the last Labour government caused Lehmann Brothers to collapse in New York.”

Mr Benn said Chancellor George Osborne had failed in his central aim of eliminating the deficit by 2010, leading to falling living standards with the poorest families hardest hit.

He said: “The truth is that the British economy was growing and unemployment was falling at the time and it does no credit to the Government to try and re-write the past.

“In 2010 the Chancellor of the Exchequer said ‘We are on track to have a balanced structural current budget by the end of the Parliament’.

“And as we know that has not happened, people have paid the price, they are worse off, they see their living standards squeezed.

“Many of the services they rely on have been cut back and it is the poorest people and the poorest communities that have been hardest hit.

“In the words of the Institute for Fiscal Studies – UK households have experienced the slowest recovery in incomes in modern history.

“That is quite some record and, despite the Chancellor’s excuses, we now know that it will take twice as long to balance the books as he said it would, and his plans for the next five years will involve extreme cuts to public spending.”

Mr Benn also criticised the Government for “comprehensively failing” to build enough houses, with homes built at half the rate needed , house prices rising out of reach, more people in their 20s and 30s living at home and more people having to rent.

He said Labour supported the Help to Buy ISA outlined in the Budget but added that, without building more houses and increasing supply, the measure would simply put prices up further and put homes more out of reach for first-time buyers.

Mr Benn said: “I credit Mr Pickles and the Government – it has taken steps to try and help first-time buyers, including Help to Buy, including the measures that were in the Budget which we support, especially for first-time buyers.

“But I just say gently to you, ministers must know, and they must have been advised by their officials and lots of other people, that if all you do is to increase demand without increasing supply, all that’s going to happen is that house prices are going to continue to rise out of reach of those who dream of owning their own home – t he very people that the House wants to try and help.”

Published: Friday 20th March 2015 by The News Editor

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