Chancellor of the Exchequer George Osborne has identified that the countryís economic recovery has a long way to go before it can be regarded as ësustainable and balancedí.
Speaking to business groups in Hong Kong, the Chancellor argued that a great deal of work will need to be undertaken in order to improve the UKís levels of exports, and identified that the current nature of the countryís economic recovery is supremely ëunbalancedí.
Mr Osborne added that the government will continue to implement policy that reduces the countryís national debt, giving the clearest indication yet that further cuts to public spending are on the horizon.
The news follows a far more positive announcement from the Bank of England, who yesterday upgraded their growth forecast for the UK in 2014 to 3.4%, up from the previous 2.8%.
The Chancellorís remarks mirror the criticisms levelled at the coalition government by the Bank of England and the Labour party, who have both identified the current economic recovery as ëunsustainableí.
Last week, Bank of England governor Mark Carney ruled out raising interest rates prematurely, despite a wave of intense pressure, arguing that it is a necessary measure to retain them at their historic low of 0.5% in order bring ëbalanceí and ësustainabilityí to the UKís economic recovery.
This stance was reiterated by the Labour party, who have criticised the governmentís economic policies for ëchoking offí recovery, and have highlighted that they are based too deeply on consumer spending and the upturn in the property market.
‘Be cheerful, but be carefulí
Despite the cautious nature to the Chancellorís remarks, he did emphasise that there are positives to take from the countryís recent performance, and called on the workers in the country to ëroll up their sleeves, get to work and make it happení in order to give the UK the best chance of achieving a full and balanced recovery.
He said: “Some in Britain might be tempted to say, ‘job done – let’s avoid more hard decisions’.
“That would be a huge mistake. Abandon the plan and we abandon the progress we’ve made and go back to square one.”
He added: “As well as reasons to be cheerful, there are also reasons to be careful”.
“The recovery is not yet secure and our economy is still too unbalancedî.
“We cannot rely on consumers alone for our economic growth, as we did in previous decades. And we cannot put all
our chips on the success of the City of London, as my predecessors did. Britain is not investing enough. Britain is not exporting enough.”
‘Long-term economic security’
A persistent theme in the Chancellorís speech was his emphasis on building ëlong term economic securityí for the UK, and identified improving small business investment and export levels as the fundamental components to ensuring this manifestís in reality.
However, the Labour party have hit out at the government, arguing that their obsessive pursuit of bringing down the countryís national debt has contributed heavily towards the ongoing ëcost of livingí crisis that the country is currently experiencing.
Shadow Treasury Minister Chris Leslie said: “George Osborne is finally recognising that the recovery, which he choked off in 2010, is still not secure or balanced.
“But he has not yet admitted that working people are facing a cost-living crisis and are £1,600 a year worse off since he became chancellor.
“We need action to secure a stronger recovery and earn our way to higher living standards for all.”