Osborne to miss deficit target as UK economy stalls and unemployment rises

[alp227]

Source: The Guardian

George Osborne is braced to admit this month that the scale of Britain's economic slowdown, demonstrated by youth unemployment spiralling to more than 1 million, means he will be unable to meet his main deficit reduction target before the next election.

It is now expected that the Office for Budget Responsibility (OBR) will declare at the time of Osborne's autumn statement on 29 November that the downturn's impact is more permanent than thought and the government may not be able to meet its commitment to eliminate the structural deficit – the part of the deficit unaffected by growth – by 2014-15, as he predicted in the June 2010 budget.

The expected delay is symptomatic of the damage on the public finances being wrought by lower-than-expected growth and deepening unemployment.

The admission over deficit reduction does not mean the chancellor will break his mandate, as that gave him the leeway to eliminate the current structural deficit either by 2014-15, or a year later.

Read more: http://www.guardian.co.uk/business/2011/nov/16/osborne-deficit-uk-economy-growth

[DJ13]

1. economy stalls and unemployment rises

Isnt that what everyone with a brain said would happen when austerity is imposed on the masses to cover the expense of rescuing the 1%?

[bloomington-lib]

2. They underestimated the scale of the problem

They should have cut even more taxes and fired even more government employees. Works every time unless it wasn't enough the first time. I'm being sarcastic, but they really do believe that.