ED BALLS RESPONDS TO NEWS OF DOUBLE DIP RECESSION

Ed Balls MP, Labour’s Shadow Chancellor, in response to today’s economic growth figures, said:

“David Cameron and George Osborne complacently boasted their austerity plan had taken our economy out of the danger zone, but their failed policies have plunged us back into recession.

“We consistently warned that their austerity plan was self-defeating and that cutting spending and raising taxes too far and too fast would badly backfire. David Cameron and George Osborne arrogantly and complacently dismissed people who warned of the risk of a double-dip recession and the country is now paying a very heavy price. Their economic credibility is now in tatters.

“The reason why last month’s Budget is such a disaster for Britain is not just because it unfairly cut taxes for millionaires while clobbering families and pensioners, it also failed to come up with the plan for jobs and growth Britain desperately needs and we have been urging.

“Not only has our economy shrunk in the last two quarters - a 0.5 per cent contraction, which means we are in recession - but our economy has actually shrunk by 0.2 per cent in the year and a half since George Osborne’s spending review.

“And far from the Eurozone being to blame for Britain’s woes, it was only growth in the EU and the rest of the world which kept us from going into recession earlier. Excluding exports, the domestic UK economy has now been in recession for over a year.

“The Chancellor needs to explain why America, which has taken a much more balanced approach with a jobs plan to boost growth, has more than recovered all the output it lost in the global recession while our economy is shrinking again.

“The price of this recession is billions more borrowing to pay for economic failure. The Government’s pledge to balance the books by 2015 is now in tatters and the next Labour government will have to clear up George Osborne’s economic mess.

“The longer this out of touch and incompetent Government sticks with these failed policies, the more damage will be done.”