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Is the weather to blame for poor economic growth?

11:29 UK time, Tuesday, 25 January 2011

The UK's economy suffered a shock contraction of 0.5% in the last three months of 2010, as the severe weather hit activity. What is responsible for poor economic growth in the UK?

There were expectations that December's severe weather was expected to hit activity but economists had still forecast growth in the quarter of between 0.2% to 0.6%.

Chancellor George Osborne said "There is no question of changing a fiscal plan that has established international credibility on the back of one very cold month. We will not be blown off course by bad weather."

In a speech earlier this week, Sir Richard Lambert, the outgoing boss of the CBI business body, accused the coalition of failing to come up with policies that support economic growth.

Do you think the figures are temporary factor due to December's adverse weather conditions? Has the government been concentrating too much on cuts rather than economic growth? Has your business been affected by the weather?

Thank you for your comments. This deabte is now closed.

Comments

Page 1 of 12

  • Comment number 1.

    sNOw.....

  • Comment number 2.

    :quote.
    The severe weather hit activity in the quarter, but the Office for National Statistics (ONS) said even if the weather impact had been excluded, activity would have been "flattish".
    :equote.

    and

    :quote.
    These are obviously disappointing numbers, but the ONS has made it very clear that the fall in GDP was driven by the terrible weather in December," Mr Osborne said.
    :equote.

    Errr unless the BBC's reporting is severely inaccurate, the ONS made it very clear that the fall in GDP was not driven by the terrible weather in December.

    How on earth can one trust politician?

  • Comment number 3.

    Is the weather to blame? NO - it's the government. They have succeeded in making the markets and business jumpy but individuals too!

  • Comment number 4.

    No the problem lies with our chancellor.
    Even the CBI (long time buddies of Tories are knocking him)

    George always has been clueless, he never had a plan 'b' like a lemming he's bound for the cliff edge.
    An admirer of the Celtic Tiger Economy, to such a degree he has helped bale them out.
    Poo pooed the previous govt plan to get the country out of recession (which it did) but has nothing in place to promote growth, all he knows is cuts and sell off's, there has to be somebody within the two parties that can do the job better than our current Mt Bean.

  • Comment number 5.

    Casino banking by the current political establishment's patrons destroyed the economy. End of story. With the exception of a few lowly scapegoats, they remain unpunished while we pay and pay and pay for their irresponsible greed.

  • Comment number 6.

    The weather was extreme and caused most of the UK to falter, so it is reasonable it would affect growth.

    Did it effect my company - no.

    Are they focussing too much on cutting - probably but difficult to tell because all of the media coverage is on the cuts, including a large amount of exaggeration and mis-reporting.

    Apart from their treatment of fuel duty, which does need urgent review before it does cause a second dip recession, I am prepared to give them the benefit of the doubt.

  • Comment number 7.

    There are lies, more lies and dammed statistics, does anybody really believe all these figures that these people come out with any more, last week we were told inflation was running at 3.8% (yeah right, more like 38%). Do none of these people live in the real world?

  • Comment number 8.

    I am no fan of the coalition as anyone who has read my previous postings will know.
    However, one quarter of poor figures is insufficient to base an opinion on the economy.
    A large portion of the population failed to get to work or even do their Christmas shopping.
    The proof of the pudding will be once the figures are adjusted and the full impact of the public sector cuts take effect.

  • Comment number 9.

    In part, maybe. But we'll never know. This country's economy is a matter of politics, not figures. I wonder what the excuse will be next time?

  • Comment number 10.

    No, a minor hiccup.

    In the last 100 years under the leadership (for want of a better term) this country has run up a dept of £4.7 Trillion Pounds.

    All 3 main parties have hence shown themselves totally unfit to run this country.

    I admit that I have no idea as to who would be.

    I fear a massive political/economic/social storm coming, but look forward to a better future afterwards.

  • Comment number 11.

    For sure the weather was a contributory factor.
    But based on past behaviour, I wouldn't put it past the politicians to inflate the bad weather's contribution to the slump.
    The reality is we can't believe anything any of them say anymore.

    I was in Malaysia and Singapore at the tail end of last year. Over there they are calling it the Western Recession. All the while our politicians are saying "its not our fault its a global thing".

  • Comment number 12.

    I dont think the weather is to blame - I think it is because we are going into a double dip recession as the quantitative easing (aka Printing money) has ceased and inflation is exploding. According to Ye Olde method of calculating inflation (including bread, milk etc) its looking more like 8%!

    But I must confess its quite interesting see the spin put on these figures and I cant wait to watch the coalition try and squeal out of it.

  • Comment number 13.

    So it was the snow.
    It must be true, Vince said so.
    Isn't that eerily similar to 'leaves on the tracks'?
    Bearing in mind that any growth in the economy to the end of September must be credited to the previous government, it makes you wonder.
    And worry.
    But don't panic, with Vince as Corporal Jones and George as Private Pike, they'll have it covered.
    Just don't tell them your name.

  • Comment number 14.

    I`m sure the cold weather impacted on sales but the effect would have been marginal and these figures show a more worrying trend. Sir Richard Lambert is absolutely right when he said " The government have taken a series of policy initiatives for political reasons, apparently careless of the damage they might do to business and to job creation". The private sector will be unable to take up the slack of the public sector job losses....fact, and the government have no policy in place for job and economic growth. They are seriously out of their depth and in the next year or so we will be into a double-dip recession.

  • Comment number 15.

    Mr Osborne said: "These are obviously disappointing numbers, but the ONS has made it very clear that the fall in GDP was driven by the terrible weather in December"

    However:

    "the ONS said even if the weather impact had been excluded, activity would have been "flattish"."

    = more Tory lies.

  • Comment number 16.

    So the Baron Osborne wants to blame it all on the Weather.
    It may have escaped his Baronesses notice but last winter 2009-10 was the worst on record for 40 years and yet with a Labour government we managed to achieve growth over the Winter quarters.

    Perhaps it was the wrong type of snow this year!

    It couldn't possibly be that this train wreck of a government is utterly incompetent and unable to see past a cut everything and hope for a bloody miracle agenda!

  • Comment number 17.

    I think lazy people are to blame for it, not the weather. By coincidence, I live on a street on which myself and two of my work colleagues also reside. I made it to work covering 15 miles through thick snow and ice everyday during last years cold spell. My colleagues both took time off stating to management they were unable to make it due to the weather. They were more than embarrassed when they found out I had been successful whilst driving my old banger to work each day. The very same happened to my Brother who had to travel to the shop he worked in by covering 30 miles and yet his colleagues who lived in the same town as the shop called in saying they were stuck indoors!

  • Comment number 18.

    Sounds perfectly reasonable to me that a period of extreme cold and snow preventing anyone getting out would affect trade figures.

  • Comment number 19.

    Although the weather certainly had a part to play, Governmental cuts are the main cause. Life is harder and more expensive and so it's unsurprising that there is not more money being put back into the economy.

  • Comment number 20.

    How can the figures be temporary whan vat has not yet kicked in. Job losses in the public sector still not impacted, people who are not redundant so concerned about their employment that they will stop spending. The economy contracting and inflation rising proves to me this government is going too far too fast with cuts, and has no policies to encourage growth in the private sector. This is not temporary we are in for the long haul with the brunt being born out by the woking class and the vulnerable.

  • Comment number 21.



    If the governments mismanagement of the situation so appallingly serious the comments would be laughable.

    A pathetic excuse from a pathetic government


  • Comment number 22.

    I'm sure the coalitions cuts and the media reaction to them have also contributed, however I still think they where necessary. But I would like to see clear policies now being put into action to encourage the private sector growth the coalition has been talking about, sadly so far that has been somewhat lacking and if they don't get to it the economy could be in real trouble.

  • Comment number 23.

    IM WAITING FOR THAT FAMOUS SAYING THAT USUALLY OCCURS WHEN THE TORIES ARE IN POWER - TIGHTEN YOUR BELTS-. IF YOU DONT BUILD HOUSES AND BRIDGES AND INVEST IN ALL INFRASTRUCTURE AND KEEP PEOPLE WORKING AND PAYING TAX THEN WE WILL NEVER GET GROWTH.TORY/LIB HAVE SLAMMED THE BREAKS ON THE ECONOMY AND IT WILL PROVE TO BE A MASSIVE MISTAKE.MORE PEOPLE WILL LOSE THEIR JOBS AND NEED THE STATE FOR SUPPORT,THEY WONT PAY TAX AND WONT HAVE MONEY TO CONTRIBUTE TO GROWTH.A MORE GENTLE STRATEGY NEEDS TO BE IMPLEMENTED WITH SUPPORT TO SMALL BUSINESSES AND GET PEOPLE IN WORK AND FEELING MORE CONFIDENT.IF WAR BROKE OUT TOMORROW MONEY WOULD BE FOUND SO STOP DESTROYING OUR ECONOMY.I HOPED THESE PEOPLE IN GOVERNMENT WERE INTELLIGENT BUT THEY CERTAINLY LACK SOMETHING.

  • Comment number 24.

    Looks like blaming labour for all our financial woes has worn thin, so they're blaming the weather now.

    There will come a time when the Coalition will have to take responsibility for their own actions, looks like we're beginning to see the predictions of a double dip coming into play.

    However time will tell, interesting to see what the the position will be in 6-12 months time, then we'll know. If the position improves they will take credit, if not it will all be Labours fault.

  • Comment number 25.

    Let's face it... It was the wrong kind of snow LOL

  • Comment number 26.

    How British, to blame the weather. The contraction in the economy is more likely to be caused by loss of jobs, pay freezes, rising gas/electricity/petrol costs & ordinary working people being squeezed for every last penny by the government to 'plug the defecit'. There has been a lot of talk about cuts BUT not enough talk about encouraging manufacturing out put which would bring new money in to our failing economy. We have a chancellor who doesn't have a clue about real life budgeting, I don't hold out much hope for him to successfully turn this country around.

  • Comment number 27.

    I think that's probably right.Construction and mining (both sensitive to the weather) appear to be the worst hit , while manufacturing and utilities are still showing growth.Lets see what the next 3 months shows as the weather is supposed to improve and can then see if growth returns the construction and mining sectors.

  • Comment number 28.

    Get real, bad weather to blame? this is England, when do we have good weather!

    People no longer have the cash or credit to splash out on needless buys, people are becoming more intelligent with their money.

    I blame the fudged figures and lies between banks/corps etc.

    srsly BAD WEATHER?!

  • Comment number 29.

    "Is the weather to blame for poor economic growth"? is the HYS question.

    Look at the Daily Telegraph online and see that Britain pays £6.4billion to the EU, the second highest after Germany? Am pro EU membership - but we need membership fees re-negotiated.

    In addition, the next quarter figures will probably look entirely different.

    All ordinary people want is to keep their jobs, meet their bills and keep a roof over their heads. For many, a holiday is something other people do?

  • Comment number 30.

    The weather has NOTHING to do with it. Pathetic excuse. This contraction is the beginning of the double-dip recession Gordon Brown so rightly warned about.

    Oh dear, Tories! Seems like your economic "wisdom" has failed you after all, and Labour were right all along. This is why I will always vote Labour and why everyone else should too.

  • Comment number 31.

    Is the weather to blame for poor economic growth?

    I've heard it all now. What is to blame for poor economic growth is the simple fact that, leaving aside the top bankers, nobody has got any money to spare. One would have thought one would have been aware of that, from the many previous HYS topics which were related to this subject.

    In any event, I rather dispute the implication that continuous, unchecked "economic growth", however you define it, is necessary, desirable or even possible.

    As for the outgoing CBI mouthpiece, who cares what he thinks? The CBI won't be happy until the minimum wage is 1p per hour, taxation is nil and employment protection legislation is outlawed. The CBI are busily doing to this country exactly what the Unions were accused of in the 1970s. The only difference is that the unions were trying to improve the lot of millions of workers while the CBI are trying to improve the lot of a few hundreds of greed-merchants whose lot is pretty good already in comparison to most people's.

    The free capitalist market works by having lots of people spending money; the more people spending, the more "growth." It's ultimately unsustainable of course, but transferring all the money into ever-fewer hands is not the way to keep it moving forward.

  • Comment number 32.

    The rise in VAT, the long term job prospects of many people, stagnation in wage levels, the rise in utility prices all adds up to the fact that people are not going to or can't spend. The trend is going to be downwards and it doesn't take an economics degree to work that one out.

  • Comment number 33.

    The weather, ha, what a cop out!

    We had snow for about week, right?

    Plently of time for the local councils and government to pull their fingers out, clear the roads and get customers to businesses. But these magic cuts prevented that, and now the economy has suffered.

    Cuts will not help the economy. The government needs to stop looking at making quick savings and quick profits, this where Mrs Thatcher lost the plot, she didnt look further into the future than the following day.

    Bad weather, i have never heard such a childish excuse for incompetance!

  • Comment number 34.

    The Government does not have a clear constructive credible plan to improve the economic growth, thus reducing the corporate debt.through selling the output from the improved economy !!

    How can it be understandable and credible for there to be no support for industrial output, thus improving the increasing unemployment rate , thus reducing the debt burden - with the banks not lending, not supporting new business and giving 0.2% interest to savers !! Has our Country gome barking mad - We have no strong manufacturing industry - We import food and milk to the detrement of our own farming industry - We have no fishing fleet - We import Gas, Oil, Electricity.

    We sell off companies like there is no tomorrow !

    Yet the Rich get Richer and The Poor get Poorer !!

    We are looking over the edge of the Abyss into oblivion !!

    Somebody needs a good kick up the backside - WAKE UP AND GET REAL !!!

  • Comment number 35.

    Don't be ridiculous - there was only one months bad weather and that included Xmas.

    How can we have sustained economic growth when most of us are afraid of redundancy, we buy too much from abroad (because its cheap), and unemployment is set to soar. Food, petrol etc is going up by the day, most of us have had no wage increases for well over a year, interest rates mean no income from savings (if you've got any). And remember that this is before many of the cuts and VAT rises are factored in. At least supporting capital projects means the country actually gets something from spending to create jobs.

    Richard Lambert is right - cut too much and the economy falters - no-one has money to spend and things get worse - look at the great depression. As the cuts really bite, tax revenue is going to fall (lack of consumer spending, no tax paid by the unemployed)and the benefits bill is going to increase.

    No party politics - but isn't it about time that you have to have an economics degree or at least some proper basic economic training to be our chancellor. Would you employ a driver who hadn't passed their driving test? In times like these I'd rather see Alan Sugar at number 10 (or 11 for that matter). Political idealism must take a back seat now.

  • Comment number 36.

    Your question is :-

    Is it the weather to blame for poor Economic Growth in UK ?

    No certainly not for-or-in, UK;

    It's always possible in other part of the world, where there's floods and
    other disaster's have-occurred,

    God help us all, from Rotten politician of the Countries, they live-of-the people of their own !

  • Comment number 37.

    Good question - because everyone on here is a really expert in the economy. It's reasonable that the weather will have affected some industries more than others, and that being the case we should see an upward trend again next quarter.

    If it goes up next quearter I'll be interested to see how the 'experts' on here, saying how it's all due to the government, are going to explain it.

  • Comment number 38.

    From my own personal perspective, the weather did not change my spending patterns. The fragility of my financial situation dictated that I spent less towards the end of the year. I see no impending improvement. Last year I had a pay freeze; the year before, I had a token payrise; the year before that I was outsourced (& despite the legislation regarding this, I was financially worse off as a result). In the 5 years leading up to the outsourcing I had a pay freeze... With prices rising, bills rising & pressure from shareholders to increase profits, employers are squeezing both suppliers and employees. With the economic climate such that there are few alternative jobs, employers know that they can force the issue. Job security is non-existent; jobs are being outsourced to other countries & yet despite all the cost cutting, everything still costs us more. Corporate culture has changed - whereas previously staff retention was considered a positive goal, it is now seen as a weakness. Staff loyalty is no longer sought or encouraged (If anything, quite the opposite). Companies no longer concern themselves with the welfare of their staff - we have become too heavily focussed on constant growth, constantly increasing profits. The more companies that costs by off-shoring, the fewer people there are in the UK able to afford their products and services, the more the economy shrinks and the more the population depends on benefits. What we need is a wholesale change in attitude, not further and deeper cuts as we've been promised.

    If attitudes do not change, we'll end up with a country where skilled jobs are all undertaken by offshore companies bringing cheap staff from overseas for 6 month contracts, while our skilled (and expensive) workers are forced to accept low paid unskilled work or to head overseas themselves.

  • Comment number 39.


    A "shock contraction of 0.5%" I really don't think it was a shock to anyone after the bad weather we have had!
    The BBC should not report using such emotive words; You are the ones spreading doom and gloom. Everyone I speak too thinks that this recession would be far easier to work through if the media were more positive. What was wrong with saying "economic growth affected by winter weather"
    Start reporting more responsibly - please.


  • Comment number 40.

    In what way is this a 'shock contraction'?

    Who is this a shock to, and what have they been doing for the past 12 months?

    New government is formed, immediately cuts a ton of funding and now they're shocked the economy's contracted? Why did they think this would have anything other than a detrimental effect on the economy?

    Someone please tell our PM isn't /that/ stupid.

  • Comment number 41.

    Dont most people panic buy in the snow? or is this the result of the Greedy banks, not lending to small business or normal customers? The supermarkets are allways full when I go shopping? snow or No Snow, or The government Con/fibs cuts, and the V.A.T. increase on most goods, and record unemployment are to blame?????? Could also be much worst than reported.

  • Comment number 42.

    It must have been the wrong kind of snow.
    I think someone is making excuses to cover up the fact that our economy is spiralling downwards. The reason we're in this mess is because of successive incompetent Governments who chase ideolodical ideas and borrow money/or sell assets to pay for these duff ideas. Putting all our eggs in the one basket of financial services was a fatal flaw. When will they get it into their heads that we need manufacturing and investment in infrastructure. When will our Government put the need of the country before their pals in the city's private wealth?
    All the snow did was curb some peoples ability to buy cheap foreign goods.

  • Comment number 43.


    It is true that the weather is one of the determinants of production and consumer spending and hence a determinant of growth.

    The weather would have to be severe to make a difference. But the weather is just one determinant amongst many.

    So for the government to point finger solely at the weather is very irresponsible.

  • Comment number 44.

    Wrong type of snow was it?

  • Comment number 45.

    Don’t blame it on the weather. You are fooling yourself if you think the weather is the only factor.

    Construction down by 3.3% - yes weather has caused some delay. However, when you think about it all the major construction projects, new schools, roads, and affordable housing are in the public sector. This is where the government has taken money out of the economy.

    I predict growth for Jan – March 2011 may recover to figures resembling 0.2 – 0.6. Overall growth for the whole year under 1% which is very bad news for those made unemployed in the public sector. In turn this will filter down to the private sector as people start to tighten their belts. So I many private companies also failing. Dark times ahead!

  • Comment number 46.

    Surely the salt and anti-freeze industries must have bolstered the UK economy during this quarter.

    And Millets.

  • Comment number 47.

    Cold weather cannot be the complete explanation. The winter of 2009/2010 was also exceptionally cold.

    If many people have lost their jobs or expect to do so, there is bound to be a drop in demand. This is the main factor causing the reduction in growth and is exactly what was forecast by many economists. The rise in food and fuel prices, made worse by the low sterling exchange rate, is also an important factor.

    This is just the start. The effects of most of the Osbourne cuts are still to come through. It is unlikely that these cuts will even achieve their alleged objective of reducing the deficit, because of the effect of slow growth on government receipts.

    The extra confidence in the bond market that the government claims is the benefit of Osbourne's tough stance, will quickly evaporate during the next few months, because it will become even more obvious that the deficit cannot be reduced by measures which stifle growth.


  • Comment number 48.

    Why is the chancellor disappointed ? I thought all his cash was offshore.

  • Comment number 49.

    4. At 11:51am on 25 Jan 2011, paul wrote:
    No the problem lies with our chancellor....An admirer of the Celtic Tiger Economy, to such a degree he has helped bale them out.

    -----------------

    Given that the UK makes a profit on the loan, how exactly is that a problem?

  • Comment number 50.

    Well...it wont stop privatised energy companies making vast profits again,will it?
    Once again it appears this goverment are blaming the weather for a lack of economic growth from sevice industries.
    When they really should be investing in our ever declining manufacturing industries and doing what almost every citizen of the UK wants.A total ban on ALL immigration.

  • Comment number 51.

    Maybe the weather had some effect, but I think it's also a lot to do with the Government's lack of economic vision. No doubt economic growth will fall even further this year with the mass public sector redundancies and the rise in VAT. Would be nice if Vince "Scrooge" Cable actually had some ideas to implement instead of boring us with his endless waffle.

  • Comment number 52.

    Gordon Brown vindicated. Chancellor relieved it was the weather to blame all along...... apparently.

  • Comment number 53.

    Fantastic for our dear goverment to have something to blame other than capitalism of course. I know who and what i blame and it has notthing today with a few days snow.

  • Comment number 54.

    Seems like Mr Balls may turn out to be right after all (about the double dip recession). The weather is unlikely to explain all the decline in growh and the effect of the VAT increases and the spending cuts are yet to come.

    If this happens, I want to see those snug right wing commentators disgraced in public

  • Comment number 55.

    What absolute nonsense. The weather was not the main cause of our poor trade figures of late.
    For a variety of reasons our manufacturting base has been undermined by different factors in the last ten years. Poor management of the country's resources, lack of expertise from our politicians, poor handling of our welfare payments, but most importantly a lack of competition with other EU countries. Added to this is the fact that our financial base has been weakened by our gold reserves being undersold.
    Too much of our financial base is spent on welfare, therefore we have to realise that we cannot support third world countries with our largese at the expense of our industry.

  • Comment number 56.

    No. The weather is not responsible for our poor economic growth. It is the inevitable result of the machinations of the Lib/Con Government that is happy to trash our Economy as it reforms our Society
    into a Tory Right Wing State .

  • Comment number 57.

    · 37. At 12:15pm on 25 Jan 2011, Khuli wrote:
    Good question - because everyone on here is a really expert in the economy. It's reasonable that the weather will have affected some industries more than others, and that being the case we should see an upward trend again next quarter.

    If it goes up next quearter I'll be interested to see how the 'experts' on here, saying how it's all due to the government, are going to explain it.

    #####################################

    When the trend is again down next month, I will be delighted to read your explanation, wrong colour daffodils perhaps


  • Comment number 58.

    not surprising really given all the adverse circumstances. I think the trend downwards will continue despite the government having some optimism. Many more redundancies will follow in the public sector and the private companies like the SME I work for are not going to be taking up the slack from the publice sector. imports will decline and as for exports - do we have any?? ( apart from the invisibles ) All in all more doom and gloom but its largely of the governments making

  • Comment number 59.

    It is a combinations of bad weather and Gordon Brown's failed economic policies. If there is no improvement towards the end of the year Brown should still be blamed together with Ed Milliband for not preventing the unions from holding the country to ransom.

    The coalition's cuts (sorry reforms) must be given a chance to work.

    Apologies to the team of HYS posters in Tory central office. I hope I have not nicked your response to this discussion.

    Just to stick the knife in: we have a deficit from the last government which requires urgent action...all in it together. Yawn...

  • Comment number 60.

    25. At 12:06pm on 25 Jan 2011, Dai the Tie wrote:

    Let's face it... It was the wrong kind of snow LOL

    -------------------------------

    Not only that but i`m sure we will hear someone say they inherited it from the previous government.

  • Comment number 61.

    This morning, George Osbourne sounded more like the weatherman than the man in charge of our finances. I think he used the word 7 times in a couple of minutes! A bit like BR blaming the leaves! Iv'e never heard such a load of rubbish. They were obviously caught totally off guard by these figures, which is also very worrying. Yes, the weather may have played a part, but not totally to blame. What is for sure, is that we are not out of trouble despite all of the measures put in place by this coalition government.
    George Osbourne is not fit for purpose and should start listening to, and taking advice from the many economic experts we have. They seem to be better at predicting the effect of government measures far better that the government can!

  • Comment number 62.

    The economy hasn't really shrunk - we're just suffering from reality creeping into the figures. The figures are slowly letting go if the imaginary growth the city pretended we were having, but when push came to shove turned out to be accounting fraud.

  • Comment number 63.

    Well the weather's unusually kind for the time of year now, so let's see what difference if any, it makes, shall we?

  • Comment number 64.


    As far as this government is concerned, Labour is responsible for everything bad about the UK economy.

    It is so surprising that the government is not blaming the weather too on Labour if it really affected the GDP figures.

    It seems all reasons to put the blame on Labour have been exhausted.

  • Comment number 65.

    I would think snow was a contributory factor in December - but what about the rest of the qtr?

    As a household in December we spent £400 at Christmas for food and drink and overall we spent £1000 on Christmas, we aim this coming Christmas to spend in total £400 full whack.
    This month I have finished off one loan which will not be renewed £15 a week saved £60 a month, I have cancelled sky films £20 odd a month saved, cancelled a home care agreement with BG for just £11 a month, taken advantage of one year interest free credit on a credit card and paid of two credit cards with the money, we have bought a new car saving each year a large amount in diesel over petrol paying £30 road tax instead of £230 a year, we have booked two holidays one in Scotland one in Cornwall in fabulous cottages two of us will get two weeks holiday in suburb accommodation for (we are sharing with friends) £300 each, we buy meat from the co op as its British meat or from local farms who breed and kill there own, I shop on line and used to keep anything I bought even if I didn't love it now it goes back, we support our Country all we can, all the money saved we are saving not spending but it appears for every step forward we take we seem to take two steps back.

    There is very little other than food from the Butcher that we buy which is BRITISH...............that is the problem.

  • Comment number 66.

    Baron Osborne does not have a clue about life. IT is beginning to sound (already) like "The lady is not for turning".

    Eventually, there wil be nothing left to sell off - we are selling the forests now!!

    Maybe we could sell air to breathe, would that work do you think? We could at lest tax it, I think. Of course, you would have to exclude the bankers from paying tax on it - in case they went somewhere else.

    Funny how Germany is not in this mess. They had the same weather, but there again they still have:

    1. Siemens
    2. BMW
    3. Merck
    4. BASF
    5. Bayer
    6. Mercedes

    etc.

    All manufacturing companies that the German Government has ensured are bouyant.

    All we do in this country is take half cooked ideas, take a bit from here and a bit from there and expect it to work.

    Well look where it has gaot us!!

  • Comment number 67.

    Anybody who believes that this recession is over is deluding themselves. I'm no economist but if you think that we are climbing out of this hole by judging its depth by one narrow, inaccurate, and virtually pointless statistic you need to think again. Only when and if we ever get unemployment, the deficit and the national debt down to a reasonable level and we stop importing more than we export can we start to believe that. And none of those things will happen unless we as individuals, as groups and as a country stop paying ourselves more than we produce.

  • Comment number 68.

    If it is the cold weather and heavy snow in UK affect growth, why don't you see the same trend in Canada, Norway, Sweden, Russia or Finland?

  • Comment number 69.

    I don't believe that the bad weather was entirely the cause of the fall in growth. Many retail outlets misread what a large section of the public planned prior to Xmas and that was to delay buying most presents until after Xmas and New Year. The thinking behind that was primarily the VAT increase but also there was a belief that many retailers would not pass on the VAT in January and might even further reduce items after the sales or even extend their sales period. I know of many who waited until mid-January before buying laptops and desktop PCs and got real bargains.

  • Comment number 70.

    And so it begins....

    Blame everything except the fruitless nihilistic economic policy of greed that this hopeless bunch of backhand charlies expound.

    This country needs investment in business, small and large to create jobs. It needs to see control of the Ponzi scheme that is the banking system. It needs to invest in infrastructure. It needs a vision of a better Britain where there is equitable opportunity of education and advancement for all its population.

    We have a divided society where the Rich are getting richer and the poor (and now middle classes) are getting poorer. For the sake of all that is decent can we not have a Government that is prepared to do something about it instead of pandering to the avarice of Mammon?

  • Comment number 71.

    The bad weather probably contributed, but I would think the largest factor will be the increase in fuel costs, this affects everything from production, distribution to going to the shops to buy things. It's all just more expensive so demand drops.

  • Comment number 72.

    I would not blame the weather for this! I would largely blame our style of Government and our over inflated public sector.

    I urge all of you to research the current style of Government in Hong Kong. There was a TV documentary on a few weeks ago. I was astonished because ordinary working people received a very good deal. However I was also upset as I immediately compared their decent standard of working living to that of ours.

    An ordinary person would earn more money while paying no/less tax and Employers/richer folk would pay tax. There would be some financial assistance for people without a job. However there would be no incentives for people to make claiming benefits and having children a way of life like it is in Britain.

    Honestly, if you are a hardworking person on a low/modest wage, taxed to death and who gets no help from anyone yet constantly pays for those who expect hand outs - you would love the Government in Hong Kong.

  • Comment number 73.

    Why can't the politicians and the media wait for the fully-reviewed figures, which aren't available yet? This isn't news, it's a prediction of news. There are more important items of real news to think about.

  • Comment number 74.

    Does this mean if we have ecconomic growth the Con/Dems will give all the credit to the sunshine?

  • Comment number 75.

    By definition, the economy is the net result of the decisions taken by all the individuals participating in it.

    You'd have to ask each one what the reasons were for all the choices they made during the period to be sure of the explanation.

    Your guess is probably as good as any economist's unless he can be bothered to wade through a mountain of figures, and then his opinion would only be half as good as the accuracy of the data...

  • Comment number 76.

    60. At 12:28pm on 25 Jan 2011, corncobuk wrote:
    25. At 12:06pm on 25 Jan 2011, Dai the Tie wrote:

    Let's face it... It was the wrong kind of snow LOL

    -------------------------------

    Not only that but i`m sure we will hear someone say they inherited it from the previous government.


    I'm just waiting for someone to blame Mrs Thatcher, too LOL

  • Comment number 77.

    I think it's just that ordinary people have wised up to the fact that it is bad to have debt when interest rates can only go up. Spending might be good for the economy but at the moment belt-tightening is better for the individual.

    One personal observation says it all: in December the shops selling £2.50 christmas cards were half empty while the bargain 99p outlets were packed out!

  • Comment number 78.

    Cutting the public sector is long overdue but if the government are expecting business to pick up all the slack they are mistaken.

    The Government need to put in place measures to help business. Up to now they have done nothing. Indeed they are still tinkering around with welfare and rights of workers that only add red tape.

    Just like Labour, the Conservatives have got no MPs let alone ministers who have ever worked in industry.

  • Comment number 79.

    50. At 12:20pm on 25 Jan 2011, Rikiiboy wrote:
    Well...it wont stop privatised energy companies making vast profits again,will it?
    Once again it appears this goverment are blaming the weather for a lack of economic growth from sevice industries.
    When they really should be investing in our ever declining manufacturing industries and doing what almost every citizen of the UK wants.A total ban on ALL immigration.

    =========================================================================

    How easy a target has immigration become. How immigration affected the weather, only heaven knows.

  • Comment number 80.

    Could someone please tell me why economic growth is so important? Can't we just get by with less yet still enjoy life.

  • Comment number 81.

    #16. At 12:01pm on 25 Jan 2011, steve wrote:
    So the Baron Osborne wants to blame it all on the Weather.
    It may have escaped his Baronesses notice but last winter 2009-10 was the worst on record for 40 years and yet with a Labour government we managed to achieve growth over the Winter quarters.

    Perhaps it was the wrong type of snow this year!

    It couldn't possibly be that this train wreck of a government is utterly incompetent and unable to see past a cut everything and hope for a bloody miracle agenda!

    --------------

    I was thinking exactly the same myself.

  • Comment number 82.

    This government doesn't seem to have a clue. If you cut jobs then there will be less money available. If you scare people about cutting jobs then people won't spend! They need to invest in people.

  • Comment number 83.

    Anyone not involved in the world of politics or finance is well aware of the delicate nature of our nations economic health. How do you grow an economy when a high proportion of our population is indebted and concerned from their future incomes. The retail sector will be squeezed more and more as purchases decline, the housing sector will remain depressed until prices return to historic averages. The nation needs to service its public and private debt, if you are doing this, you will not be spending on anything but the necessities. The south east may have a feel good factor about it for the next year or so, but that is the consequence of the olympics, a public subsidy bonanza for the few. I felt a sense of desperation within the media over Christmas, almost a campaign to get us out into those shops, it didn't happen, it won't happen, most of us will do what is right from ourselves because we know things are not good and will not get better for a long, long time. These times call for strong government with an aim, we have a friendly partnership with old fashioned tax raising ambitions. If the UK is to succeed we need to plan 10, 20 years ahead, start by giving tax breaks to new small business start ups, reduce fuel tax, NI and spread the burden over new innovative taxes. Shake up the status quo else we will end up as nothing more than a Chinese retail outlet.

  • Comment number 84.

    NO.
    There are several things to blame, all of which could be fixed very simply by a bit of actual government action:
    a) The government continues to spend money abroad, this removes cash from this country, lowering demand for British goods and handing cash to competitors of British companies. A BMW car for the police secures NO British jobs and represents 25,000 (a years wages) leaving the country. Buying a Jaguar - even if it cost 35,000 would secure British jobs, secure demand in the UK, garner tax in the UK and support growth in OUR economy.
    b) The government 'invests' abroad - for example a British company running a successful software engineering apprenticeship has had to close because of lack of support while seeing our government 'investing' in Microsoft (a huge American company) copying what we did using American employees. Hardly a recipe for British growth.
    c) The costs to business in the UK of investing is far too high. The banks are charging massive fees and ursurous interest rates on the very few loans they are willing to make. This could simply be stopped by instructing the two banks we own to make zero charge business bank accounts available and restricting their interest rates to 1% above Bof E base - this would allow business in the UK to invest.
    d) We continually allow even government owned banks to fund foreign take overs of our companies followed by massive job loses and factory closures - this must be stopped and could be very simply
    e) The government continues to hand billions to europe, we should just stop this immediately, that is money which is removed from the economy which naturally will shrink it.
    f) The government has failed to just say NO to the bonuses at the two government owned banks, each penny in bonus paid to someone with more money than they can possibly ever spend is money that isn't invested in real business creating real jobs. Just 10% of the RBS bosses bonus would have allowed my company to provide 25 apprenticeship places and 6 places for experienced engineers, instead he has a fat bank account and we are closed!
    g) The government and media fail to see that big bank profits are BAD, they are bad because a bank produces nothing, therefore makes no wealth at all, the 'profits' come from ripping off private and business consumers leaving less money to invest.

    All of this is very simply fixed if only the government werer to stop fiddling while the country burns.
    And none of the above would add to our deficit or debt. Even buying Jaguar in stead of the apparently cheaper BMW is actually cheaper, if you take into account the tax, saved benefit, extra demand in the economy its far cheaper to spend more on the Jaguar - this is why Germany buy German, China buys Chinese, France buys French, America buys American..... all around the world we are the only country where we stupidly think buying foreign is better!

  • Comment number 85.

    Our lack of an industrial base thanks to Thatcher, Major, Blair and Brown is mainly to blame. Basing an economy on Service Sector/Banking may work in Switzerland but not here.
    Not supporting loans to cutting edge companies such Forge Masters etc and leaving them to raise finance via the spineless Banks is utter madness.
    Labour did make a mess but learn from the mistakes and program in sound proven economic reform otherwise we will bump from one economic disaster to another. Ok if your family are rich and can avoid taxes etc, most people do not live in that world.

  • Comment number 86.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 87.

    The contraction in the british economy is not a shock to me as I was expecting this to happen with the Tory-led coalition's drastic cuts, which have yet to fully bite. The situation is going to get worse if the coalition continues along the same path, which seems very likely at the moment. The bad weather made the situation even worse, but there still would have been no growth in the economy if the weather had been ok.

  • Comment number 88.

    There is no getting away from the fact that we as a country are up to our ears in debt both the government and as individuals. Our standard of living is declining and will continue to do so until we are far poorer than China. It does not matter how much profits banks earn they will never replace the jobs and real incomes from lost manufacturing. With energy use being made more expensive by government decree we have no hope of any economic growth and will decline to a holiday destination for the Chinese keen to see the country that humiliated it in the 19th century.

  • Comment number 89.

    By inclination, I vote between UKIP and Tory.
    Therefore I am not blinkered and blindfolded like so many left wing inclined HYSers. This recession and everything that stems from it is because Labour couldn't manage a bunfight in a bakery.

    However this weak, watered down, left leaning Coalition is NOT the answer. The sooner the Tories slough off the pervasive influence of the Liberals, the better.

    Anyway, the reason that there was a 'shock' contraction is obvious and expected. What is patently clear is that if people have less money, then they (shock horror) SPEND LESS!! It has very little to do with the weather.

    So with everything going up and wages being frozen, people are simply not buying at the levels that traders have become accustomed to.

    Not exactly a eureka moment...

    Contrary to the sanctimonious declarations from a thoroughly discredited and hated Labour opposition, this is NOT unexpected. It may even be repeated regularly over the next few years. We as a country have to face up to this. The Tories have to fix what Labour broke (as usual). That means that there will be more bad news for years to come and we have no option but to grit our teeth and accept it.

    What we must NOT do is start to wander off into Narnia, or some other parallel universe where we start to believe that Labour could possibly ever be entrusted with government again.

    The country can't have that short a memory, surely?

  • Comment number 90.

    SNOW way.Its the chancellor,this is what you get with a school boy supported by Fib-Dems.

  • Comment number 91.

    #18. At 12:03pm on 25 Jan 2011, RightWingIDBanned wrote:
    Sounds perfectly reasonable to me that a period of extreme cold and snow preventing anyone getting out would affect trade figures.

    -------------------

    Funny though, how last winter was worse than December but the previous government did not blame the weather!

  • Comment number 92.

    I await the Chameleon to come out with its all your fault.

  • Comment number 93.

    Politicians like to blame everything else but themselves. Blaming the weather is a new low, even for them. During the snow I managed to drive to work and back without any problems, this was despite the severe weather warnings/spin from our politicised Met Office. I wonder what will be next - blaming "climate change" for a poor economy?

  • Comment number 94.

    76. At 12:41pm on 25 Jan 2011, Dai the Tie wrote:

    60. At 12:28pm on 25 Jan 2011, corncobuk wrote:
    25. At 12:06pm on 25 Jan 2011, Dai the Tie wrote:

    Let's face it... It was the wrong kind of snow LOL

    -------------------------------

    Not only that but i`m sure we will hear someone say they inherited it from the previous government.

    I'm just waiting for someone to blame Mrs Thatcher, too LOL

    -------------------------------

    Nah everyone knows it was the vikings who are to blame for bringing it down from the scandinavian countries.....lol

  • Comment number 95.

    These amateurs just don’t get it do they, there is no money left to be spent apart from in the pockets of the wealthy who award themselves big bonuses and who can afford to employ people to tell them how to avoid paying tax probably by using off shore accounts.

    As for the rosy picture, politicians can make sows ear sound like a silk purse but the fact is their policies are going to kill this country.

    I see the building trade was down 3.3% and yes that could be due to the weather but in reality it is more likely to be due to the cut backs in public spending which have seen huge building projects cancelled.

    Still when Cameron is thrown out of the door as he will be he can go in the comfort of knowing that he has his PM’s pension to live on whilst he writes his memories.

  • Comment number 96.

    Can you not wait and see what the reality is? This is the ONS's first stab based on very incomplete data. Let's see what the true situation is in Feb/March first!

  • Comment number 97.

    83. At 12:45pm on 25 Jan 2011, whowrotethis wrote:

    Recommended!

  • Comment number 98.

    Bad weather certainly had a detrimental effect on the growth figures for the last quarter of 2010 but the trend has been going downhill for the past three quarters. The Con/Dem economic policies are TOO HARSH and we will probably have a double-dip recession and a general election before the end of 2011. Mark these words!

  • Comment number 99.

    Ahh, here we go.

    A question asked to the heaving masses who really don't have a clue. However the Labour party supporters will be happy to scream that this means the Coalition has lead the country down the tubes away from the old Brownite vision of economic prosperity by borrowing/crossing your fingers and hoping everything turns out all-right. The Tories supporters will say it's all down to the weather despite rising cost of fuel and food.

    Point is, correlation does not equal causation. The drop in retail was expected because it was highly reported, the numbers show a drop in construction and mining which was unexpected. How about asking the people actually in those industries whether the weather or something impacted their business and then basing our opinions of what's happening to the economy on facts rather than what particular political party you happen follow with complete mindless devotion.

    Oh, and don't put your faith in economists foresight. If you put 10 economists in a room you'll get 11 different opinions.

  • Comment number 100.

    "Economics is the art of explaining why the predictions you made yesterday didn't come true today." In that respect you could describe George Osborne as an Economist.

    Blame cold weather all you like, if an economy lacks the resilience to come out of a cold snap without shrinking, then it can hardly be described as healthy.

 

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