BRITAIN’S Prime Minister David Cameron will seek to switch the focus to boosting economic growth today after unveiling deep spending cuts that some economists fear could plunge Britain back into recession.
Cameron’s speech to the Confederation of British Industry, a leading business group, comes a day before third quarter growth figures and other data this week expected to point to further housing market weakness and a drop in consumer confidence.
That could raise fears of a return to recession and give ammunition to critics of last week’s spending review.
Cameron’s coalition government slashed public spending by £81bn ($127bn) to tackle a record budget deficit of almost 11 per cent of national output.
The government is looking to the private sector to grow and replace the near 500,000 public sector jobs expected to disappear because of the spending cuts.
Cameron is due to announce a £200m ($310m) investment in the next four years in Technology Innovation Centres, bringing together university researchers and business.
“To build that new dynamism in our economy, to create the growth, jobs and opportunities Britain needs, we’ve got to back the big businesses of tomorrow, not just the big businesses of today,” according to advance extracts of his speech.
Cameron will also say that access to finance must be opened up, venture capital funding encouraged, and banks again must start lending to small businesses.
Business Secretary Vince Cable brushed aside predictions of poor economic growth data. Analysts expect tomorrow’s quarterly gross domestic product growth to come in at 0.4 per cent, compared to the previous quarter’s 1.2 per cent.
CBI Deputy Director General John Cridland said he was confident the economy would grow in 2011, adding that it was critical that the government stick to its austerity plan, which is an effort to safeguard Britain’s triple-A credit rating.
