Caerphilly MP Wayne David’s blog: April 30
A Double-Dip Recession
It was depressing news that Britain has gone back into recession. Unlike the United States, where President Obama has pursued a very different economic strategy to this country, Britain has experienced negative growth for two consecutive quarters. That means we are now going through a double-dip recession.
We are now experiencing exactly what Ed Balls, the Shadow Chancellor, warned might happen. It gives me no pleasure to say ‘we told you so’ because the recession will mean the loss of jobs and livelihoods for thousands upon thousands of people.
One of the main reasons why our economy is stubbornly refusing to grow is the massive public spending cuts which the Government is pushing through. In all common sense, the Westminster Government needs to recognise that we must have a balanced programme of debt reduction but at the same time providing support for businesses to grow.
Sadly, the response of the Tory-led Government is to refuse to do a u-turn. Instead it may actually increase the extent of Government cuts. If this were to happen, the social and economic consequences would be truly horrific. As things stand, the ‘cuts’ are really starting to bite even though less than a third of the planned cuts have been implemented. If there were even more cuts things will get significantly worse.
In real terms for this area the cuts mean increasing unemployment, further reductions in welfare benefits, fewer police, declining local authority services and increasing pressure on the health service. At the same time all the indications are that the top 5% in our society – which doesn’t include anybody I know in Caerphilly – will get ‘richer’. The recent Budget was part of that programme of reducing public expenditure but at the same time reducing the 50p tax rate for those who earn £150,000+.
No sensible person would argue that Britain’s deficit should not be reduced but it has to be done reasonably over an appropriate timescale and in a way which does not undermine the economic growth which we so badly need. I only wish that the Westminster Government would see things this way.
Labour MP for Caerphilly