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Vince Cable warns against George Osborne's complacency over recovery Vince Cable warns against George Osborne's complacency over recovery
(7 days later)
Coalition divisions over the government's central economic policy will be highlighted on Wednesday when Vince Cable criticises George Osborne for showing complacency over Britain's recovery.Coalition divisions over the government's central economic policy will be highlighted on Wednesday when Vince Cable criticises George Osborne for showing complacency over Britain's recovery.
In a sign of his continuing concerns over the chancellor's handling of the economy, the business secretary will say that this attitude represents one of a series of dangers to the economy.In a sign of his continuing concerns over the chancellor's handling of the economy, the business secretary will say that this attitude represents one of a series of dangers to the economy.
Cable will also challenge Osborne, who used a speech on Monday to hail the government's help for the housing market, when he warns of an uncontrollable housing boom.Cable will also challenge Osborne, who used a speech on Monday to hail the government's help for the housing market, when he warns of an uncontrollable housing boom.
Labour said the speech, to be made at a joint government/CBI industrial strategy conference, was "an embarrassing slapdown to George Osborne's deeply complacent and out-of-touch speech".Labour said the speech, to be made at a joint government/CBI industrial strategy conference, was "an embarrassing slapdown to George Osborne's deeply complacent and out-of-touch speech".
Cable, who made clear in a lengthy New Statesman article earlier in March that he had deep reservations about the pace and impact of the chancellor's deficit reduction plan, will highlight what he sees as a series of dangers and say that Britain cannot rest on its laurels after the recent encouraging signs of economic growth.Cable, who made clear in a lengthy New Statesman article earlier in March that he had deep reservations about the pace and impact of the chancellor's deficit reduction plan, will highlight what he sees as a series of dangers and say that Britain cannot rest on its laurels after the recent encouraging signs of economic growth.
"One [of the dangers] is complacency, generated by a few quarters of good economic data. It isn't difficult to see evidence of confidence returning, and there are positive trends in production. Taken together with success stories like the car industry and export growth in emerging markets, we have the beginnings of a recovery story," Cable plans to say."One [of the dangers] is complacency, generated by a few quarters of good economic data. It isn't difficult to see evidence of confidence returning, and there are positive trends in production. Taken together with success stories like the car industry and export growth in emerging markets, we have the beginnings of a recovery story," Cable plans to say.
Cable will not name Osborne but sources made clear that he felt uncomfortable at the tone adopted by the chancellor in a speech on Monday in which he said that Britain was "turning the corner" and said that advocates of an economic plan B had lost the argument. Cable, who has spoken of the need for a "plan A+", believes Osborne was wrongly seeking to take the credit for the recent growth which Cable claims is the result of "pragmatic British businesses and flexible British workers".Cable will not name Osborne but sources made clear that he felt uncomfortable at the tone adopted by the chancellor in a speech on Monday in which he said that Britain was "turning the corner" and said that advocates of an economic plan B had lost the argument. Cable, who has spoken of the need for a "plan A+", believes Osborne was wrongly seeking to take the credit for the recent growth which Cable claims is the result of "pragmatic British businesses and flexible British workers".
The business secretary, who called in his New Statesman article for "more prudential borrowing by councils for house building", will also raise doubts about Osborne's views on the housing market. On Monday, Osborne defended his Help to Buy scheme, designed to help the property market by underwriting low-deposit mortgages to ensure that borrowers can secure a mortgage with a deposit as low as 5% of the value of the property. He said he had not unleashed "exotic weapons of financial mass destruction".The business secretary, who called in his New Statesman article for "more prudential borrowing by councils for house building", will also raise doubts about Osborne's views on the housing market. On Monday, Osborne defended his Help to Buy scheme, designed to help the property market by underwriting low-deposit mortgages to ensure that borrowers can secure a mortgage with a deposit as low as 5% of the value of the property. He said he had not unleashed "exotic weapons of financial mass destruction".
Cable will say: "There are risks, not least the housing market getting out of control. Recovery will not be meaningful until we see strong and sustained business investment."Cable will say: "There are risks, not least the housing market getting out of control. Recovery will not be meaningful until we see strong and sustained business investment."
IChuka Umunna, the shadow business secretary, said of Cable's speech: "This is an embarrassing slapdown to George Osborne's. But it also reminds everyone that you can't trust a word the Lib Dems say. Vince Cable has supported the chancellor's policies which choked off the recovery in 2010. Three wasted years of flatlining that has left families worse off and done long term damage to our economy is his record."IChuka Umunna, the shadow business secretary, said of Cable's speech: "This is an embarrassing slapdown to George Osborne's. But it also reminds everyone that you can't trust a word the Lib Dems say. Vince Cable has supported the chancellor's policies which choked off the recovery in 2010. Three wasted years of flatlining that has left families worse off and done long term damage to our economy is his record."
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