Tuesday, 25 January 2011

When politicians start blaming the wrong kind of snow..

Alistair Darling is reborn on Sky news just now, hammering George Osborne's record harder than Ed Balls hits the punchbag in his garage.

I was a minister for a long time and when politicians start blaming the wrong kind of snow you know something is wrong, says Darling, who thinks the recovery is at risk because of the direction of government policy.

Apart from blaming the weather for the shocking 0.5% reduction in growth the big message from George Osborne and David Cameron today is that there will be no change in government direction.

My notes from this morning's lobby are littered with the words "choppy" and "difficult course" from the Prime Minister's Official Spokesman.

The PMOS own notes from the cabinet discussion of the economy were that Cameron told colleagues that they had "set a difficult course that was never going to be easy".

But, said the PM, dealing with deficit "is not an alternative to growth, it is a pre-requisite. We should not be blown off by one quarter's figures".

Asked about the possibility of a double dip recession the PMOS kind of avoided answering directly (quite a few times) and pointed out that coming out of previous recessions there have been quarters of flat or negative growth.

"We've always said its likely to be choppy," said the PMOS. "Clearly they are disappointing figures, somewhat below the bottom end of range expected by forecasters."

He noted the worst winter weather in 100 years might have something to do with the quarterly results but journalists reposted that two thirds of the figures came before a drop of snow fell.

Is this a blip, we asked? Well, previous experience shows this would happen. The PMOS said: "The important thing that we are confident the approach is the right one and that there isn't any alternative to dealing with the deficit. You don't have to look very far for evidence of not dealing with a large deficit."

After the weather, and who says the snow is over, there will be the is the effect of the vat rise and public sector cuts.

Are there adjustments to be made for more choppy days? Do you stick to the plan if there are two quarters of negative growth? Is it pm's view that we are out of the danger zone?

The official answered: "It is certainly true that the spending cuts are relatively small this year. There are cuts still to come but it is important to have a credible deficit reduction plan if you are going to see economic growth."

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