David Cameron: We will hold firm on economy


David Cameron: "It's as if they think there's some magic money tree. Let me tell you a plain truth, there isn't"

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Changing course on the economy would plunge the UK "back into the abyss", David Cameron has said.

The warning followed suggestions by Business Secretary Vince Cable that the government should consider borrowing more to kick-start economic growth.

But, in a speech in West Yorkshire, Mr Cameron echoed Mrs Thatcher by saying "there is no alternative" to "sticking to the plan" on the economy.

Labour said the government's economic strategy had "totally failed".

Mr Cameron said: "There are some people who think we don't have to take all these tough decisions to deal with our debts. They say that our focus on deficit reduction is damaging growth, and what we need to do is to spend more and borrow more.

"It's as if they think there's some magic money tree. Well let me tell you a plain truth: there isn't."

'Into the abyss'

More borrowing would jeopardise the prospect of "good jobs for our children", and the UK's ability to afford "good public services", he argued.

The PM continued: "I know some people think it is somehow stubborn to stick to a plan.

"That somehow this is just about making numbers add up without a proper care for what it means for people affected by the changes we make.

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She's back. She's been brought out of retirement by David Cameron. She is TINA - "There Is No Alternative" - the phrase forever associated with Mrs Thatcher in the 1980s.”

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"As far as I'm concerned nothing could be further from the truth. My motives, my beliefs, my passion for sticking to the plan are exactly about doing the right thing to help families and to help businesses up and down the country."

There were now "some signs that we can turn our economy round", he said, citing the reduced deficit, low interest rates, and higher exports to emerging economies like Brazil, Russia, India and China.

"Of course the challenges are huge. And there is, I completely accept, a long way to go," Mr Cameron said, criticising those who "would falter and plunge us back into the abyss".


He concluded: "We are making tough choices about our future. But we are making the right choices. If there was another way, an easier way, I would take it.

"But there is no alternative."

The prime minister said Britain was reaping the rewards of the tough economic course set by the coalition in 2010, and highlighted the creation of one million extra private sector jobs and higher employment rates.

But shadow chancellor Ed Balls said the UK could not afford "two more years of economic failure".

"Families, pensioners and businesses across Britain will wonder what planet David Cameron is on," he said.

Vince Cable: "We need to pursue what I've often called 'Plan A Plus'"

"He claims the economy is getting better and his plan is working, but everyone else knows that the economy is flatlining, living standards are falling and the deficit is rising to pay for the costs of economic failure.

"This defensive speech cannot mask the total failure of this government's economic plan and growing divisions in a cabinet which is now openly debating the need for a change of direction."

Writing in the New Statesman, Lib Dem Business Secretary Vince Cable suggested the government might need to change course on the economy and consider borrowing more.

He said the danger of slow growth may now be greater than the loss of market confidence through increased borrowing and that the "balance of risk" had changed since 2010, when the coalition made deficit reduction central.

But asked about his position by the BBC, Mr Cable said there was nothing wrong with the government's current strategy - commonly called Plan A.

"We need to pursue what I've often called 'Plan A Plus' - that's financial discipline and getting down the deficit, and at the same time pursuing growth. That's what we're doing and what we'll continue to do."

'Magic wand'

The BBC's Political Editor Nick Robinson said Mr Cable's argument was not new but No 10 seemed to have been caught by surprise by the timing of the article, which comes less than two weeks before the Budget and after the economy shrank in the last few months of 2012.

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Most of those economists, like Vince Cable, tend to think it's a matter of judgment whether it would do more good for the economy than harm.”

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Conservative Mayor of London Boris Johnson told the BBC: "I don't want to intrude on the chancellor's pre budget calculations, but it's definitely my view - and I know it's his view too - that you won't go wrong in this current climate by investing.

"There are plenty of people out there who want to invest in London infrastructure, investing in the big projects, and indeed cumulatively investing in them, to deliver jobs and growth - that is the way forward."

Deputy Prime Minister Nick Clegg, ahead of a meeting with Mr Cable on the government's Budget plans, said there was no division in the coalition over the need to support capital spending which he said was crucial to creating jobs and getting "the wheels of the economy moving".

He told LBC 97.3 that he was frustrated by the slow pace of some current projects but there was a risk that if the government borrowed billions of extra money, this could push up interest rates for ordinary families.

"There is no cost-free, risk-free, magic wand solution to it."


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  • rate this

    Comment number 27.

    I could do another analysis of the British economy as i so often here at university speeches and lectures but theres just no point anymore as the leaders do not care about anyones opinion unless it agrees with there 1 route plan. They say Madness is doing the same thing and expecting a different result, well its confirmed then Cameron is a fully paid up member of the monster raving looney party

  • rate this

    Comment number 26.

    2 Minutes ago
    My 18th birthday today, I can finally vote to kick out the tories!"

    So who will you be voting for, Labour???

  • rate this

    Comment number 25.

    Is David Cameron King Canute in disguise ? He clearly knows NOTHING about economics far less living in the REAL world.

  • rate this

    Comment number 24.

    Continuing with Plan A is ploughing us into an abyss, so you could say Dave’s damned if he does (change course) & damned if he doesn’t.
    Where are the Green shoots?
    Cuts alone won’t save us.

  • rate this

    Comment number 23.

    Sadly, the government machine almost entirely fails to understand balanced economics, there is much (at zero cost) that is not being done.

    It's the decades old problem of the many millions of hard working people who are paid to little to live, while their employers build high profit empires on the back of the benefits these workers need to survive.

    It's slavery all over again.

  • rate this

    Comment number 22.

    5. "OK Dave so perhaps we can have just one example of where the economy is showing signs of improvement"

    Car manufacturing and exporting. There yer go...Check the figures.

  • rate this

    Comment number 21.

    We're already in the abyss you stupid man. But let Osborne fly to Europe and try to preserve the bankers bonuses, Dave - that will save us all!!

    Why do you think that making the rich richer and the poor poorer can possibly help our economy? Please can we have someone in your cabinet who actually understands economics? Someone who lives in the real world, not millionaires row!!!

  • rate this

    Comment number 20.

    "We will hold firm on the economy" actually means "we will expect ordinary hardworking taxpayers to contribute even more taxes, whilst our pals at Amazon, Ebay, Starbucks, Google and Facebook get away with paying no taxes".

  • rate this

    Comment number 19.

    What choice do they have? It's not like they've got any other ideas.

  • rate this

    Comment number 18.

    Thats ok Dave you just carry on living in denial, dont worry about us out here struggling to make ends meet, people committing suicide as a choice rather than be homeless, peaple that work full time yet still have no choice but to collect food parcels, you really are a piece of work, you and your dodgy next door neighbour !

  • rate this

    Comment number 17.

    How can letting every business close be good for the economy? If we continue this course we'll end up being a dictatorship...run by Tesco! It's a real shame the one thing he hasn't done a U-turn on is the one thing he should.

  • rate this

    Comment number 16.

    >The same Cable who criticised Labour for suggesting that this was the >correct strategy from day 1.

    Cable is on about a small amount of future borrowing for project, Labour are saying to borrow now to give everyone a tax cut. There is quite a difference.

  • rate this

    Comment number 15.

    The man is deluded.

    A large percent of employment in any given economy, including ours, is created by SMEs. Yet Cameron's policies are starving them. Almost deliberately, it would appear. We have to invest in SMEs to kickstart the economy.

    Yet he doesn't seem short of ideas on how to keep the money rolling in to bankers and tax-dodging companies.

    Roll on 2015, when we cast the Tories out.

  • rate this

    Comment number 14.

    My 18th birthday today, I can finally vote to kick out the tories!

  • rate this

    Comment number 13.

    'Insanity: doing the same thing over and over again and expecting a different result'
    Albert Einstein

  • rate this

    Comment number 12.

    Cameron - don't worry you'll have your legacy. You'll be remembered as the presiding PM whose blantant bowing to an elite over the interests of the many put the final nail in the coffin of three party politics.

    Cameron and Blair - in it together. One and the same.

  • rate this

    Comment number 11.

    Quote .. "The biggest deficit in peacetime history is already down by a quarter, interest rates are at a record low. Exports are starting to turn around too."

    "peacetime" .. What planet is Cameron on? .. Afghanistan, Iraq . Syria?

    Wake up dude and smell the death.

  • rate this

    Comment number 10.

    We will hold firm on economy............What a joke!

  • rate this

    Comment number 9.

    Yes, he wants to hold firm on NOT capping bankers' (his chums) bonuses

  • rate this

    Comment number 8.

    "The reason we lost our AAA grading the other day is because the markets have not confidence the austerity programme is working."

    "the government has announced that fiscal consolidation will extend into the next parliament, which necessarily makes their implementation less certain."
    So Moody's are worried that Labour will win.


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