After reading (and listening) to the Chancellor's response to the news that the economy has shrunk by 0.5% in the last quarter of 2010, you have to ask whether he actually has a plan for growth. George Osbourne responded to the news by laying the blame on the severe weather, and how that affected people's purchasing over the Christmas period.
The problem is that the Office of National Statistics, who issued these figures, said that without the weather, GDP growth would have been 0% - a drop of 0.7% on the previous quarter and much less than the experts, including the Government, predicted.
What is really scary though, is that there is worse to come - the VAT increase only started in 2011, the major spending cuts have not happened yet, and the big redundancies are still to come.
The Governor of the Bank of England (Mervyn King) has said that the squeeze on UK take-home pay is necessary with inflation greater than 4% last year and not likely to decrease significantly in the near future.
Since coming to power in June 2010, the Coalition has presided over a steady decline in the economy, the Government has focussed on cutting the deficit by reducing expenditure on: college pupils whose family income is less than £30,000, benefits for disabled people, higher education students, housing benefits and of course increased VAT for everyone. At the same time they have removed funding from programmes that sought to develop regional businesses, and help the young and long term unemployed to get into the workforce.
The Government has announced that they want to re-balance the economy, to remove Britain's dependency on the financial services sector, but they do not have a growth plan to complement the deficit reduction plan.
It is not enough to cut spending and hope that the private sector will plug the gap - you do not run a nation's economy on "hope and a prayer".
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