Pressure mounting on Osborne (the other one)

There was further bad news for Chancellor George Osborne as APA joined the British Chambers of Commerce (BCC) and the Confederation of British Industry (CBI) in today warning him that it believed the UK economy would shrink by 0.4% in 2012 against government forecasts.

Not only that but APA believes 2013 figures are also overstated and growth is more likely to be around 1.2% rather than the government forecast of 1.9%. The Eurozone crisis (now focused on Spain) and a sharp rise in food and oil prices pose the greatest threat.

APA’s Gareth Osborne said: “The austerity plan (known as Plan A) is destined to fail while prices are rising so steeply and are outside the control of government. However, Plan B (the spend, spend, spend solution) is even less likely to succeed. We support an externally funded recovery led by massive capital investment by or through penalty on the Banks..

However, APA strongly backs planned growth measures such as creating a business bank and Bank of England support for small business borrowing but believes the banks should still do more to fund the recovery from recession which they so successfully fuelled.

APA