Economic recovery will not be watered down

Published by Steve McDowell on 21 March 2011.
Last updated on 21 March 2011

Westminster

Rescue measures for the economy will not be watered down despite the increasing financial pressure on British families, says chancellor George Osborne.

Osborne vowed not to water down his proposals saying: "slamming on the brakes will not work".

As the chancellor prepares to deliver his second Budget, on March 23, he told the BBC it would be a "huge mistake" to water down proposals to cut the economic deficit but did offer the small olive branch that he would not be asking for more tax rises or more cuts.

Osborne also hinted that he would put on hold a proposed 1% rise in fuel duty to offset runaway pump prices.

He may also announce an air passenger duty freeze, which at present adds £12 to the cost of an economy ticket within Europe.

This will come as scant relief to the general public, which is facing rising unemployment, weak growth and news that British families are being hit hard by austerity measures.

In further gloom, the Office of Budget Responsibility (OBR) is expected to downgrade growth forecasts for 2011 after a 0.6% contraction in the last quarter of 2010.

On the upside, economists believe public borrowing will be up to £10 billion lower than the £158 billion in the emergency Budget back in June.

Mr Osborne also gave a brief outline of long–range proposals to boost jobs and skills.

Labour wants to halve the deficit and thus slow the pace of damaging cuts with shadow chancellor Ed Balls saying: "We should get the deficit down but in a steady way, not a reckless way... George Osborne’s plan is bad economics."

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