Finance Minister George Osborne on Wednesday warned Britons that they faced an extra year of austerity measures and insisted that reversing his belt-tightening measures now would be a “disaster”.
Chancellor of the Exchequer Osborne said Britain would face spending cuts and tax hikes until 2018 — after the coalition government led by Prime Minister David Cameron had already previously extended the programme by two years to 2017.
The bleak announcement in a budget update, coming alongside grim news that the Government is slashing its outlook for economic growth, is likely to heap further pressure on the administration mid-way through a five-year term in power.
Addressing Parliament on Wednesday, Osborne also acknowledged that the Government would fail to meet its official target for reducing public debt as a proportion of economic output by 2015-16.
“It is taking time but the British economy is healing after the biggest financial crash in our lifetime,” Osborne insisted in his Autumn Statement.
Confirming that he was prolonging the Government’s austerity programme to 2017-18 — beyond Britain’s next general election due in 2015 — Osborne said: “We are making progress. It’s a hard road, but we are getting there. Britain is on the right track and turning back now would be a disaster.”
His comments came on the same day as a separate austerity budget was presented in Britain’s key trading partner Ireland.
Explaining why he was extending cuts in public spending and hiking taxes again, Osborne said the British economy faced “deep-seated problems at home and abroad.”
The Conservative-Liberal Democrat coalition government, which came to power in 2010, has imposed a series of painful austerity measures to slash a record deficit that was inherited from the previous Labour administration.
Cameron and Osborne have overseen the loss of tens of thousands of public-sector jobs, slashing workforces in the military, health service and various departments.