The Canadian Press - ONLINE EDITION

UK Treasury chief to order more spending cuts to get deficit in line

  • Print

LONDON - Britain's Treasury chief offered a dampened view of the economy on Monday, warning that substantial savings must be gleaned from welfare cuts if the country is to eliminate the deficit.

The British economy has been enjoying a stronger recovery than most European countries, but George Osborne noted there are still big underlying problems.

He said 2014 is to be the "year of hard truths" and that the country faces a choice.

"Do we say: 'the worst is over; back we go to our bad habits of borrowing and spending and living beyond our means — and let the next generation pay the bill'?" he said.

Osborne told workers at a Birmingham company that supplies auto components that billions of pounds (dollars) in welfare cuts will be needed to reduce the deficit, which was swollen by the economic crisis.

The government deficit dropped to 5.2 per cent of gross domestic product in the 2012-2013 fiscal year, from 7.6 per cent in the previous one.

His sober message comes in stark contrast to the recent news on Britain's economy. Though the recovery from the 2008-2009 recession hasn't been electrifying, Britain is doing better than most other major economies around the world. Its quarterly growth rate of 0.8 per cent in the third quarter is better than Germany's 0.3 per cent and the overall European Union's 0.2 per cent.

At the same time, unemployment has dropped to 7.4 per cent, its lowest rate in 4 years, and inflation has dropped to 2.1 per cent, just slightly ahead of the Bank of England's 2 per cent target.

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

RMTC preview of Good People

View more like this

Photo Store Gallery

  • Winnipeg’s best friend the dragon fly takes a break at English Gardens in Assiniboine Park Wednesday- A dragon fly can eat  food equal to its own weight in 30 minutes-Standup photo- June 13, 2012   (JOE BRYKSA / WINNIPEG FREE PRESS)
  • May 22, 2012 - 120522  - Westminster United Church photographed Tuesday May 22, 2012 .  John Woods / Winnipeg Free Press

View More Gallery Photos

Poll

Now that the snow is mostly gone, what are your plans?

View Results

Ads by Google