Is George Osborne ignoring the risks

There has been a revealing accusation made by the shadow chancellor, Ed Balls, who sad that George Osborne is in denial regarding the deficit plan and the risks it puts on the UK’s employment market and economic growth.

Mr Balls spoke out about how he feels that the chancellor’s current plan to clear the budget’s entire deficit by the year 2015 is “irresponsible and dangerous”. This statement also comes just after other records have revealed that there has been a sudden unexpected contraction of the economy.

However, Mr Osborne argued to via the BBC that there would likely be serious financial disruption if he was to now turn around and abandon the budget cuts and tax increases. The recent figures intensify the argument further, where official GDP results showed that there had been a 0.5 percent contraction to the UK’s economy during only the last three months of last year.

These results were dramatical over predictions of growth, expected to be between 0.2 percent and 0.6 percent. Yet, ministers have try to blame these negative results on the snow, saying that the weather for December was exceptionally bad.

Mr Balls explained how the US Treasury is trying to balance combining sustainable and sensible stimuli with a steady amount of deficit reduction payments. This has reportedly resulted in a increase in public confidence and also contributed to a steady rise in consumer spending. He also reported that drastic and quick spending cuts are not a sensible way to manage a delicate economy.

George Soros, the renowned investment fund manager, has also said that the UK’s serious austerity measures may actually cause the country to dip back into another recession.