Business leaders support Government’s spending cuts

| October 18, 2010 | 0 Comments

The Coalition Government’s decision to slash the budget deficit so soon has met with some criticism over recent times.

However, it appears that Chancellor George Osborne’s deficit reduction program has also met with support, which an open letter to the Telegraph newspaper has revealed today.

To name but a few, the leaders of Marks and Spencer, BT, GlaxoSmithKline, Kingfisher and Microsoft UK have written:

“Addressing the debt problem in a decisive way will improve business and consumer confidence.

“Reducing the deficit more slowly would mean additional borrowing every year, higher national debt, and therefore higher spending on interest payments.

“The private sector should be more than capable of generating additional jobs to replace those lost in the public sector.

“There is no reason to think that the pace of consolidation envisaged in the budget will undermine the recovery,” it said.

The open letter comes as the Chancellor is set to unveil his Comprehensive Spending Review later this week.

Mr Osborne will provide details of how the Government intends to slash spending by £83 billion by 2014 as it endeavours to bring down the spiralling budget deficit.

Over recent months, many have been critical of the harsh spending cuts warning that cutting the deficit too quickly could pose a threat to economic recovery.

However, it is inevitable that the cuts will hamper growth and many believe the Bank of England will consider injecting more money into the economy via its quantitative easing (QE) scheme to boost growth as the cuts take effect.

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