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David Cameron warns of the economic pain to come as Nick Clegg promises no return to 1980s-style cuts

OST The Prime Minister and Deputy Prime Minister have both given interviews to Sunday papers today covering the issue of how the Government is going to deal with the economic legacy bequeathed to it by Labour.

Speaking to the Sunday Times, Mr Cameron indicates that the official growth forecasts will be downgraded as he prepares people for the "pain" of the "difficult journey" ahead:

Cameron said: “Proper statesmanship is taking the right action, explaining to people the purpose behind the pain.” The prime minister said there would be no “trampoline recovery” of the economy. He warned there was a “serious problem” with forecasts inherited from Labour of robust 3% growth next year.

“There is a huge amount of debt that has got to be dealt with. Crossing our fingers, waiting for growth and hoping it will go away is simply not an answer,” he said. “The country has got an overdraft. The interest on that overdraft is swallowing up things that the nation should otherwise be spending money on. We have got to take people with us on this difficult journey.”

Cameron gave a clear hint of the priorities for the emergency budget in two weeks’ time. “You have to address the massive welfare bills,” he said. “You have to address public sector pay bills. You have to address the size of the bureaucracy that has built up over the past decade. Otherwise you will have to make reductions across the board which you don’t want to do. We need to address the areas where we have been living beyond our means.”

Mr Clegg, meanwhile, pledges in The Observer that there will not be a "repeat of the 1980s" in terms of how the cuts are introduced, pointing instead to the examples of recent Centre-Left governments from around the world:

"It is important that people understand that fiscal retrenchment does not mean a repeat of the 1980s. We're going to do this differently," said Clegg, in a move that risks angering MPs on the Conservative right, many of whom admire their former leader. The deputy prime minister said he would use his authority "ruthlessly" to make sure coalition commitments were met.

He argued there was an assumption on the centre-left that austerity measures were, by definition, regressive and rightwing: "I think principally the reason is because our collective memory of difficult budget decisions harks back to the 1980s, the harshness of the 1980s, north-south divide, sink-or-swim economics. That is our folk memory."

But Clegg argued that some of the biggest cuts programmes across the world in recent decades had been carried out by "centre-left governments", including "the social democrats in Sweden, the Clinton administration [in the US] and the Liberals in Canada".

He promised that while his party was part of the coalition there would be protection for the country's poorest areas, including his own constituency in south Yorkshire. "We're not going to allow a great north-south divide to reappear," he said.

> Read the fuller write-ups of the Sunday Times interview with Mr Cameron and the Observer interview with Mr Clegg.

Jonathan Isaby


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