Britain should be braced for a “choppy and uneven” recovery, Deputy Prime Minister Nick Clegg warned today – as a survey predicted the north of England would fare worst under Government spending cuts.
Mr Clegg stressed cuts will begin next April and be spread over four years so there is no “sword of Damocles that’s going to come down straight away”.
The results of the Government’s Comprehensive Spending Round will be announced next month, and a BBC survey of English regions today predicted spending cuts would hit the North and the Midlands worst.
The study by Experian predicted Middlesbrough would be the worst-hit town, followed by Mansfield, Notts, and Stoke-on Trent.
Mr Clegg told BBC Radio 4’s Today programme: “What we need to do is to put things in place, even as we take difficult decisions, which over time will rebalance the economy.
“I’m acutely aware that, yes, we have some difficult decisions to make but that shouldn’t stop us from trying to rebalance the economy at the same time.”
He said that means boosting private sector jobs to replace public sector jobs, through measures such as the Government’s £1bn (€1.2bn) regional growth fund and national insurance breaks for firms in certain regions.
Mr Clegg went on: “Whilst I totally understand people’s anxieties, I don’t think we should aggravate that anxiety and fear by pretending there’s a sword of Damocles that’s going to come down straight away.”
He said even after the CSR the Government would be spending more than it does at present.
He added: “We are trying to rebalance the economy so that parts of our economy are not over-reliant on the public sector.”
The Deputy Prime Minister warned: “Of course this recovery, which is starting, is likely to be choppy and uneven. Of course we appreciate we are dealing with a long-term problem about how we rebalance the economy. That won’t be something we can do overnight.”
But he went on: “I think people have, perhaps understandably, forgotten this is a plan spread over several years. It’s a very important point.”