David Cameron has urged colleagues to stop talking down the economy as he tries to drown out a growing chorus of doomsayers with a resolutely upbeat assessment of the nation’s prospects.
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David Cameron
The prime minister, writing in the Financial Times before what are expected to be gloomy quarterly growth figures, said it was important to remain optimistic.
“Above all, at home and abroad, we must counsel against the pessimism and fear that can become self-fulfilling prophecies in global markets,” Cameron writes.
“Whatever the obstacles to growth today, we still boast some of the best universities in the world, the most favorable timezone in the world, and the world’s first language. I passionately believe that the global economy is presenting us with opportunities, not threats – and we must seize them.”
Cameron’s intervention comes amid growing concern within senior government circles about the negative remarks being made by senior politicians and officials at a time of fragile consumer confidence. A third of Britons are cutting back on spending amid anxiety about keeping their jobs, according to a poll released on Monday by Resolution Foundation, an independent think-tank.
Vince Cable irritated senior colleagues last month when the business secretary described the challenges facing Britain as the “economic equivalent of war” and warned he could not see “sunny uplands” breaking through the storm clouds.
Sir Mervyn King, governor of the Bank of England, declared Britain’s economic recovery off-track last week as he announced plans to pump more money into the economy on the grounds that it would now take longer to return the economy, public finances and interest rates to normal.
Weak underlying prospects for the economy present George Osborne, chancellor, with a perilous backdrop to his November autumn statement, when he is likely to be forced to admit the deficit reduction plan is also off-course.
Despite the macroeconomic outlook, the chancellor will try to reassure skeptics that he has a plan for the economy when he unveils the second leg of his growth review.
Business lobby groups want to see a “Plan A plus” to bolster confidence and unlock private investment into energy, housing, broadband and transport.
Cameron says the coalition is on an “all-out mission” to unblock the planning system and get infrastructure projects moving. “In terms of future productivity, this infrastructure deficit is as serious as our budget deficit. And in terms of job creation today, getting construction projects off the ground is critical.”
To prove the point, he says two new power stations in Yorkshire – Ferrybridge and Thorpe Marsh – will create 1,000 new jobs on the back of £1.2 billion ($1.9 billion) of investment. Meanwhile, BT also announced it will complete its roll-out of superfast broadband by the end of 2014.
Turning to the summit of the Group of 20 leading economies in Cannes this week, Cameron says he will be pressing for more progress on the detail of the euro zone deal forged last week. He also wants to unlock global trade.
“Inward-looking, beggar-my-neighbor policies benefit no one,” says Cameron. “We’ve got to push for a more balanced world economy, where countries like the UK do better at saving and investing and restoring their competitiveness, and trade surplus economies increase domestic consumption.”