Ed Balls warns of 'lost decade' on growth
Published: 29th Apr 2012 14:22:36
Britain faces a long "lost-decade style" period of slow economic growth, Labour's Ed Balls has said.
The shadow chancellor told the Observer deficit reduction had to be balanced with a plan for jobs and growth.
It comes days after official figures showed the economy returned to recession, shrinking by 0.2% in the first three months of 2012.
But David Cameron said he would not abandon spending cuts as to do so would jeopardise the UK's low interest rates.
He warned that the eurozone - which receives 40% of all UK exports - was not "anywhere near halfway through" its crisis, and faced a "very long and painful process" ahead.
On Wednesday the Office for National Statistics published the latest GDP figures which showed the UK had entered a "double-dip" recession, as the economy had shrunk again, following a 0.3% contraction in the last three months of 2011.
This is a very important moment in this Parliament but Labour's got a lot of work to do”
The Sunday Times has published a survey of 1,717 adults, carried out on Thursday and Friday, which puts support for Labour on 40% while support for the Conservatives has plunged to 29% - days before the local elections in England, Wales and Scotland.
Mr Balls told Sky News there was still "a long way for us to go" but he believed, with the UK having returned to recession, people would start to ask: "What's the alternative?"
He said David Cameron and George Osborne's competence was "in tatters", following a Budget which he described as "cutting taxes for millionaires and putting taxes up for pensioners and families".
"This is a very important moment in this Parliament but Labour's got a lot of work to do."
He told the Observer that a credible deficit reduction plan had to be balanced with a plan for jobs and growth.
David Cameron: "The figures this week were extremely disappointing"
"I am not predicting years of recession although we could well be in for a long 'lost decade' style period of slow growth and high unemployment," he said.
The risk was that "the economy continues to under perform and, Japanese-style, it grows below trend and therefore unemployment stays high. That sort of stagnation is consistent with a bit of growth, but not enough, that could go on for a very long time."
Mr Balls, who backs a VAT reduction and new bank bonus tax to fund youth job measures, said with "such a fiscal clamp down" it was hard to see how to get the economy out of trouble.
But Mr Cameron told the BBC the government "absolutely mustn't" throw away its deficit-cutting plan - warning that to do so would jeopardise the UK's low interest rates.
He said there had been too much debt in UK banks, households and government and dealing with it took time but argued that he was taking the right long-term decisions and not be "driven off by the short-term difficulties".
The PM said the UK was going through "a very difficult, very painstaking process" of rebalancing the economy away from a focus on financial services.
He said the private sector was growing and there were positive developments in manufacturing - just not fast enough and pledged to "redouble" the government's efforts.
He also blamed the eurozone crisis on the UK's doorstep adding: "I don't think we are anywhere near halfway through it because what's happening in the eurozone is a massive tension between the single currency that countries are finding very difficult to adapt to."
On the Sunday Times poll ratings, he said: "It's been a difficult month, but it's far more difficult for people who are trying to find work... and a difficult time for the country.
"What I have to do is convince people that we're taking the right long term decisions to deal with problems in our country that have existed for many years."
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Harvard CitationBBC News, 2012. Ed Balls warns of 'lost decade' on growth [Online] (Updated 29th Apr 2012)
Available at: http://www.ukwirednews.com/news/1425333/Ed-Balls-warns-of-lost-decade-on-growth [Accessed 24th Apr 2014]
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With the doors to its brand new £1million training centre officially open, one of the UK's leading apprentice training providers, Bristol based S&B Automotive Academy, is showcasing its world-class facilities by launching a series of foreign student exchanges for the first time in its 41-year history. To get a flavour of what life is like as an apprentice in the UK, the Academy hosted 16 apprentice engineers and bus drivers from the G9 Automotive College in Hamburg, Germany, as part of a Europe-wide vocational training initiative called the ‘Leonardo Programme’ with support from the European Social Fund. In a reciprocal arrangement, S&B will be sending nine apprentices to Germany during February 2012 so that they can get an appreciation of life in the automotive industry on the Continent. A further three German exchange groups are being planned for next year. Designed to assist the development of vocational skills and training across Europe, including work placements for trainees, the Leonardo Programme has a budget of €1.75bn, which is helping to encourage UK organisations to work with their counterparts abroad. In what is expected to be another challenging year for employers in the UK automotive sector, S&B’s Chief Executive, Jon Winter, claims that the exchange initiative will bring many benefits to the Academy and its apprentices: “In a world of global automotive brands, it’s important for our learners to understand the international context of the industry they have chosen to make their career. This new exchange programme will enable apprentices and Academy staff alike to achieve a better understanding of the challenges and opportunities within the automotive arena in Europe. With the Academy’s influence also extending to the USA and Asia, there’s every possibility that this initiative could move further afield in the future.” Continued Winter: “The need for skilled technicians across the world is on the increase and we actively encourage our apprentices to look at broader horizons during their training. Many of them have already learned the phrase ‘Vorsprung durch Gelehrtheit’, quite simply, ‘Advancement through learning.” In the 2010/11 academic year, S&B doubled the number of successful Apprenticeships over the previous year with some 350 apprentices graduating from the Academy. At the same time, achievement levels reached an all-time high with an overall success rate of 85%. For those learners on the Advanced Apprenticeship three-year programme, success rates were even higher, at over 98%. PHOTO CAPTION: As part of their exchange visit, S&B Automotive Academy arranged for the German apprentices to visit Hampshire bus operator, Bluestar, at its Barton Park depot. The students are pictured with S&B’s Andy West (3rd right) and Steve Prewett, Bluestar’s Area Engineering Manager (2nd right). Ends http://www.sandbaa.com