DAVID Cameron and George Osborne insisted Britain is “on the right track” as they briefed Cabinet colleagues ahead of a mini-budget expected to be dominated by bleak economic figures.
The Prime Minister and Chancellor told senior ministers that the coalition Government was “equipping Britain to succeed in the global race”, and that everyone must make a contribution towards dealing with the UK’s debts “in a fair way”.
Economic forecasters expect Mr Osborne to be forced to extend austerity by one year, into 2018, today, due to lower than expected growth. And he may also have to ditch his target of putting the UK’s national debt on to a downward flightpath by 2015.
Mr Osborne’s autumn statement is expected to include some bright moments, with £5 billion for infrastructure spending – including £1 billion to build 10 new schools. And he is widely expected to postpone or scrap a 3p rise in fuel duty pencilled in for January, saving motorists an average £7.69 a month.
But the Office for Budget Responsibility is expected to revise down its GDP growth forecast for 2012 from the 0.8% it expected in March to around zero, and to slash its 2013 prediction from 2% to somewhere close to 1%, giving the Chancellor little leeway for generosity.
Summarising the autumn statement at the end of a Cabinet meeting in 10 Downing Street, the Prime Minister and Chancellor told colleagues its central message was that Britain is “on the right track” and the Government was dealing with the country’s deficit and debts “in a fair way”, said Mr Cameron’s official spokesman.
They said that this means “that everyone must make a contribution and that we are equipping Britain to succeed in the global race”, the spokesman added.
George Osborne and his deputy, the Financial Secretary to the Treasury, Danny Alexander leave Number 11 Downing Street to head to the Commons
Delivering his Autumn Statement in the House of Commons, the Chancellor is expected to warn MPs that there are no ``miracle cures'' for Britain's problems.
Mr Osborne will argue that he is “confronting the country’s problems, instead of ducking them”.
“The public know that there are no miracle cures. Just the hard work of dealing with our deficit and ensuring Britain wins the global race,” he will say.
The Chancellor is expected to unveil some details of the £10 billion in additional welfare cuts which he wants to impose after the general election as part of his plans to rein in the UK’s deficit.
But Liberal Democrats were claiming today that their party had used top-level talks ahead of the mini-budget to fend off plans floated by Tory ministers to end housing benefit for under-25s and limit welfare payments to families with more than two children.
Lib Dem president Tim Farron told the BBC News Channel: “I am fairly confident we have stopped all this. I don’t think there will be a freeze on benefits as well.”
Any welfare cuts are expected to be matched by a hit on the wealthy, in a reflection of the Tory mantra that “we are all in this together”, with the most likely target expected to be a cut in tax-free pension allowances from £50,000 to £30,000 a year.