Is anybody surprised?
George Osborne has a little trick that he pulls, every so often. He comes out on Budget or Autumn Statement day and tells us everything is going to be rosy and his ‘long-term economic plan’ is on target to put the economy into surplus by a certain date – if we make the cuts he is proposing on the day.
Then, at some unspecified point after that, he comes back and says an economic shock has happened and the surplus target is unreachable after all, so we’ll have to make more cuts and hold on a little longer.
That’s why we’re still in deficit, even though he originally told us we would be in surplus by 2015 at the latest – last year.
The simple fact is that, under Osborne, we will never achieve that goal.
He’ll keep using real or imagined economic shocks to ensure that he can continue making cuts. Those cuts harm the real economy and make it less possible for the UK – the state – to pay off its debts.
It’s time we stopped letting this faker fool us.
Chancellor George Osborne has abandoned his target to restore government finances to a surplus by 2020.
It had been the chancellor’s most prized goal and had been driving austerity measures in previous budgets.
However, Mr Osborne said the UK must be “realistic about achieving a surplus by the end of the decade”.
The UK economy is showing “clear signs” of shock in the aftermath of the vote to leave the European Union, he said.
In a speech on Friday, Mr Osborne said: “As the governor [of the Bank of England] has said: the referendum is expected to produce a significant negative economic shock to our economy. How we respond will determine the impact on jobs and growth.
“We must provide fiscal credibility, continuing to be tough on the deficit while being realistic about achieving a surplus by the end of the decade. That’s exactly what our fiscal rules are designed for.”
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