21 October 2015
New public sector finance figures published today (Wednesday) by the Office for National Statistics, show that public spending cuts are a failed strategy for reducing the deficit, says the TUC.
Although borrowing in the year to date is broadly in line with the latest Office for Budget Responsibility forecast, the Chancellor is expected to borrow over four times more in 2015/16 (3.7% of GDP), than he originally planned when he first set out his deficit reducing strategy in 2010 (0.8% of GDP).
TUC General Secretary Frances O’Grady said: “The Chancellor is borrowing at four times the rate he planned to this year, because his deficit reduction strategy has failed. Instead of clearing the deficit, severe public spending cuts have slowed down the recovery and held back wage growth, leaving income tax revenues and national insurance receipts much lower than expected.
“The Chancellor is in danger of repeating the mistakes of the last parliament with further public spending cuts that put the recovery at risk. This would damage the tax base and leave the public finances in a mess for even longer.”
NOTES TO EDITORS:
- The figures quoted above for borrowing as a share of GDP compared with original plans are from the Office for Budget Responsibility’s October 2015 Forecast evaluation report, table 3.1 ‘Original and restated June 2010 PSNB forecast’: www.gov.uk/government/publications/forecast-evaluation-report-october-2015
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