RegulationCorporate GovernanceBrown left UK finances “ill-prepared for crunch”

Brown left UK finances “ill-prepared for crunch”

Institute of Fiscal Studies says the prime minister’s management of economy put the UK in a weak position

The Institute of Fiscal Studies (IFS) said Gordon Brown’s management of the
economy as chancellor left the UK in “one of the weakest fiscal positions in
2010,” according to
the
Guardian
.

The report stated that the government under chancellor Brown “put the UK’s
finances in a better shape before the credit crunch” than the Tories had prior
to the 1990 recession and “cut the level of borrowing and debt inherited from
the Conservatives in 1997”, but still left Britain’s finances in a weaker
position to weather the crunch than other G7 or OECD countries.

The IFS said: “While the UK public finances were in better shape when the
financial crisis began than they were when Labour came to power, the UK was in a
worse position relative to most comparable countries.”

“Most OECD governments did more to reduce their structural deficit during the
period from 1997 to 2007 than Labour did. This fiscal position formed the
backdrop to the financial crisis.”

Group chief economic adviser Peter Spencer said the UK will “struggle to
achieve growth of 1% this year”, although believes that growth of 2.7% is
possible next year. However, he added, consumer spending is only expected to
grow 0.5%. “Households are drowning in debt but companies are swimming in cash,”
he said.

Further reading:

Government
box-ticking costs businesses £80bn a year

Cut
IT projects to reduce public spending, says Institute of Directors

Readers
turn against hung parliament

Related Articles

Corporate governance: staying ahead in accountancy

Corporate Governance Corporate governance: staying ahead in accountancy

3m Alia Shoaib, Reporter
One in 20 audit firms quit as market evolves

Audit One in 20 audit firms quit as market evolves

1y Kevin Reed, Writer
Colin: #EURef bankers a problem

Business Regulation Colin: #EURef bankers a problem

1y Taking Stock
PwC and Deloitte chiefs sign Remain letter

Business Regulation PwC and Deloitte chiefs sign Remain letter

1y Kevin Reed, Writer
Leader: Audit competition drives change, not necessarily quality

Accounting Firms Leader: Audit competition drives change, not necessarily quality

1y Kevin Reed, Writer
EU audit reform to open up £10bn market for firms

Accounting Firms EU audit reform to open up £10bn market for firms

1y Richard Crump, Writer
Best Practice: Saffery Champness managing partner Rob Elliott

Accounting Firms Best Practice: Saffery Champness managing partner Rob Elliott

2y Calum Fuller, Reporter
Standard Life Investments opposes EY's appointment as Shell auditors at AGM

Accounting Firms Standard Life Investments opposes EY's appointment as Shell auditors at AGM

2y Richard Crump, Writer