CLAIMS by Chancellor Osborne and Prime Minister Cameron that Office for National Statistics (ONS) figures showing 0.5 per cent growth is ‘good news’ were rubbished yesterday.
Gross Domestic Product (GDP) increased by 0.5 per cent in the first quarter of 2011, following a decrease of 0.5 per cent in the fourth quarter of 2010 and is now estimated to have returned to the level in the third quarter of 2010.
TUC Deputy General Secretary Frances O’Grady said: ‘Today’s figures show that the UK’s recovery has effectively stalled and our sluggish growth rate means we are now lagging way behind our international competitors.
‘The UK economy has been stagnant these past six months and with tax credit cuts, public sector job losses, tax rises and spending reductions now hitting communities and local economies, worse is yet to come.
‘In these uncertain times families right across the country remain cautious about spending more than is absolutely necessary. With demand depressed, a significant recovery in business confidence and investment seems far off.
‘Meanwhile there are close to 2.5 million people already out of work, and with many more people working fewer hours than they want to, today’s poor figures suggest the UK’s jobs crisis will be with us for some time to come.
‘In this uncertain climate it’s hard to see how current policies can help the UK economy get back on its feet. It’s time for ministers to rethink their damaging cuts and focus on creating jobs and future growth instead.’
Dave Prentis, Unison General Secretary, said: ‘Here is yet more proof that Tory policies are the wrong prescription for our economy.
‘Crossing true blue fingers, and hoping that the private sector will ride to our rescue is economic child’s play. Growth has now stood still for six months.’
The ONS figures showed that construction output decreased by 4.7 per cent in the first quarter, compared with a decrease of 2.3 per cent in the previous quarter.
Mining and quarrying decreased by 0.4 per cent, compared with a decrease of 4.1 per cent in the previous quarter.
Electricity, gas and water supply decreased by 3.5 per cent, compared with an increase of 4.3 per cent in the previous quarter.
Meanwhile, figures from the British Bankers Association (BBA), also released yesterday, showed that total net lending to companies fell in March by £4.7 billion compared with a year ago, a bigger fall than in February.
The BBA said in a statement that weak trading activity was discouraging businesses from borrowing to expand and most were orientated to paying down debt.
