Tag Archives: Dancing round the deficit

Deficit nonsense

It is extraordinary that both the main parties have now put forward their plans for meeting the deficit, which is going to prove the centrepiece of the election, yet neither plan carries credibility.   Osborne has once again committed the Tories to £30bn of further spending cuts on a rolling 3-year programme, i.e. currently targeted at 2017-8.   Even if that were politically practicable, which is far from certain,  the idea that this will eliminate the structural deficit within that timescale is laughable.   The deficit this year is likely to end up at around £100bn, and because of the fall in the government’s tax take (caused by the continuing squeeze on incomes, very low wages and zero hours contracts), the deficit is already growing, not falling, and for the reasons just given will continue to rise further in future.   Osborne grandiosely claimed yesterday that “it commits us to finishing the job – and getting our national debt falling……….Once we have got rid of the deficit and have debt falling, we should be running an overall budget surplus”.   This is total arrant nonsense.
Read more   “Deficit nonsense” »