It could not be helped with the 50 day post election rule however the new UK coalition government has cleverly decided that the Budget will be on 22nd June. No doubt hoping the country will all be immersed in the FIFA World Cup tournament, they can implement as many swingeing expenditure cuts and tax rises as possible. They may go almost unnoticed as, given our penchant for scraping through the group phases in major competition’s, we sweat about England’s final group game on 23rd June. What happens if England do not get through to the next stage and we all wake up to the reality of the serious austerity measures that have been mooted…………..”come on England”
Monthly Archives: May 2010
With no clear majority after the UK election, in essence a “hung parliament”, the country awaits the outcome of discussions between the main political parties on how a coalition government could optimise a strategy that would some positive impact on the economy.
The Bank of England also has held the UK base rate at 0.5% in May and decided not to pump any more money into the economy through quantitative easing. The British Chambers of Commerce and Institute of Directors both agree that with the fragile situation rates should not be raised. Inflation is over 3% for April and the last quarter’s initial growth estimates at 0.2%, half the final quarter of 2009 indicating another potential slow down in the economy.
All this pales into insignificance with the events surrounding the Greek debt crisis, and to a lesser extent the problems in Spain and Portugal, as the global markets declined rapidly last week when it appeared that Greece “had finally gone bust”. The reaction on Monday to a European Central Bank initiative for a three year stability package to support the Euro, thus stemming the decline of Eurozone countries, provided an initial 5% increase in share prices. The “see saw” antics of stock markets caused by over eager market makers shows that as a global institution, we are being influenced by a lot of uncertainty of what the future holds and when, or if, stability will return in due course.
Whatever the situation in the UK, now and in future months, it is the global macroeconomic movements that are going to influence a recovery or “double dip” recession in individual national economies, but the consumer and business will have to deal with fallout for some years to come.
The final canvassing surrounding the UK election takes place today; after three television debates, the unfortunate comments by Gordon Brown and the tactical voting issue, the main political parties realise that a “hung parliament” could be the outcome on Friday morning. The electorate knows that the UK is in financial trouble and that no matter who they vote for there will be public spending cuts, tax increases and possibly benefit reductions. Although some voters have a lifelong allegiance with one party this time around there is no guarantee, but many voters look at the headline policies and think “how will they impact me” and not “what is best for the country”. It is hoped that the turnout will be higher this time with an increase in younger voters but whatever the outcome, there is a long hard climb back for the UK to get out of the national debt hole. Is there an 0800 number we can call?