Chancellor George Osbourne has warned Conservative colleagues to not “get ahead of themselves” in celebrating the UK economic recovery. Mr Osbourne attempted to cool signs of excitement in the Cabinet about Britain’s recent economic performance.
The world economy remains volatile and a fresh international crisis could easily arise to shatter confidence in the UK recovery, Mr Osborne said.
Earlier, a senior Government source had painted a rosy picture of the economy, claiming that the UK was increasing distancing itself from “bucket economies” in the eurozone and joining the US in the top rank of fast-growing nations.
Mr Osborne was speaking as he arrived at a G20 summit in Russia, where he planned to tell world leaders that Britain’s economy has come a long way from the depths of economic crisis in the years leading to 2010.
“This is first time the G20 has met in recent years where there is not a sense of crisis about the global economy, and indeed the performance of some advanced economies has been better than when leaders met last year and even when finance ministers last met in July,” the Chancellor said.
Some economists now believe the UK is growing at pre-crisis levels, and several forecasters have sharply raised their predictions for growth.
However Mr Osborne warned against over-optimism.
“We are still in the early stages of recovery. We still have great economic challenges. I arrive at this summit as the finance minister with pretty much the highest budget deficit around the table, even though it has come down by a third.
“So we have a long way to make up for what happened. We are still in the early stages of that journey,” he said.
Some senior Conservatives believe that the economy is now a political asset for their party. Earlier, a senior source gave an upbeat message to reporters travelling with David Cameron to St Petersburg.
“We are moving away from the bucket economies of Europe and the UK is now seen alongside the US in terms of economic performance,” the source said, adding: “This is a good moment for us and the country.”
But Mr Osborne cautioned against getting carried away about the economy.
He said: “I don’t think anyone should get ahead of themselves: unemployment is too high, the deficit is still too high.
“Yes we have had better economic news and yes confidence is improving, but as we have seen many times events can overwhelm and shake that confidence.”
– Source: The Telegraph