The latest GDP figures out today show that last year the economy grew at its fastest pace since 2007. But it ran out of puff in the final quarter and according to a London Business School economist, we have ended up with a deficit which Labour had predicted and that the then Opposition had called ‘a recipe for financial market disaster’.
Richard Portes, Professor of Economics, London Business School and President of the Centre for Economic Policy Research (CEPR), told the Today programme earlier today: “The operation has been successful, but the patient almost died. The percentage of people employed is still well below the pre-crisis rate and real wages are 6% below their pre-crisis peak.”
Asked whether the economy is a strong card for the Tories, Professor Portes replied: “It depends how the other parties play it. If they point to the way in which the deficit has been handled, it’s not a very good story at all. They [the coalition] pledged to eliminate the deficit by now. We have ended up with a deficit which Labour had projected and which the then Opposition called a recipe for financial market disaster”.
Despite a seven-year high, economic growth fell below the independent budget watchdog’s predictions and looks set to be a key battleground for the political parties with less than 100 days to go until the UK General Election.