What George Osborne should say tomorrow if GDP figures are half decent
By Tim Montgomerie
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If the quarterly growth numbers are poor tomorrow then at least three months of misery await the Coalition. Its central project is economic renewal and another bad set of numbers will intensify concern at the Chancellor's policies.
The expectation of the markets is, however, that the numbers will be good. Many economists expect growth of +0.4% and very possibly more. The Prime Minister did nothing to discourage optimism when at Prime Minister's Question Time earlier today he rattled off a list of encouraging statistics on jobs, borrowing, inflation, crime and NHS waiting lists before promising that "the good news will keep coming".
When the Chancellor responds to tomorrow's statistics he needs to offer (1) arguments more than statistics and (2) a view of a long-term rather than rejoicing at the short-term. People don't believe statistics and they're often right to be sceptical. The Office of National Statistics' GDP numbers are notoriously unreliable. Few are impressed when politicians list statistical achievements. More memorable and more resonant are arguments. There is also the problem that we live in an age of unpredictability and uncertainty. Tomorrow may not be a turning point but a false dawn. Some commentators even warn of a triple dip recession and they shouldn't be discounted. Continuing contagion from the €urozone and a US economy yet to face up to its fiscal challenges add up to real dangers.
"Today's growth numbers are welcome news but they are just one quarter's numbers. What I ask from the British people today is patience. Today is a good day and it follows last week's good news on inflation and jobs. Let us be clear, however, that the path ahead won't be smooth. Many governments across the world borrowed too much, spent too much and wasted too much. Britain's Labour government was the worst of its kind. Problems that grew up over many years aren't going to be overcome quickly or easily. I ask the British people not to judge this Government on any one set of official statistics but on whether we take the right decisions for the long-term. This government could deliver a quick splurge of unsustainable growth by borrowing like there was no tomorrow. That is the Labour recipe and I reject it. Britain's new economy cannot be built on debt. It must be built on rock. The divide in British politics is between this Government that will ensure Britain stops spending money that it doesn't have. That ensures that work pays more than welfare. That our schools give children real skills and real qualifications. That we invest in new roads, railways, universities and energy plants. This is the path to prosperity. It's a long one but we all know in our hearts that there are no short cuts. We won't let the British people down."