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New 'Osborne recession' is price of failed gamble on 400,000 public sector job cuts and blaming the EU won't wash says GMB

29 November 2011

Many of the measures are tinkering, squeezing public sector pay will deepen the deflationary pressures and the proposals to cut public sector pay in already depressed regions will cut demand even further and make it harder to get deal on pensions says GMB

GMB commented on the Autumn statement and the growth forecasts by the Office for Budget Responsibility.

Paul Kenny GMB General Secretary said “A new “Osborne recession” is the price of the failed gamble on 400,000 public sector job cuts and blaming the EU won't wash.

Many of the measures announced today are tinkering that do not address the lack of demand in the economy. The continuing squeeze on public sector pay will deepen the deflationary pressures. Proposals to cut public sector pay in already depressed regions will cut demand even further. The higher unemployment being forecast show it's not possible to deflate your way to growth and a balanced budget.

As well as the shameful unfairness of further pay restraint on already hard-pressed public sector workers, the Chancellors announcements will push the possibility of a pensions deal further away. The contribution rises government want are plainly unjustified and unaffordable, while moving the goal posts on retirement age mid-negotiation smacks of deliberate deception. No doubt this will boost the strike turnout tomorrow.

The Organisation for Economic Co-operation and Development (OECD) predict a new recession in the UK. They see 0.03% contraction in the UK economy this quarter, and a further 0.15% in the next.

This new recession can properly be called “Osborne's recession” since it was his failed gamble, that new jobs in the private sector would replace his 400,000 public sector job cuts, that stalled the recovery from the “bankers recessions” that was underway when he took office.

Osborne lied that the “bankers recession” from the US was made in Britain. He is now trying to lie that “Osborne's recession” made by him in Britain is the fault of the EU. This will not wash.

In 2012 several other nations in the EU will have far higher growth than the UK. These are Lithuania, Estonia, Latvia, Poland, Bulgaria, Romania, Finland, Denmark and Sweden.(See notes to editors EU Commission forecasts for GDP growth in 2012).

The grim truth is that “Osborne's recession” was made in Britain by him. He could not have done it if the Lib Dems has not broken their election manifesto commitment not to cut spending until the economy had made a full recovery.”



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