Economy 'is turning the corner' – George Osborne
George Osborne has signalled Britain's economy is "turning a corner" as a run of good data indicated the South West is on the mend.
The Chancellor's most optimistic assessment about the country's prospects yet came as the region's housing sector, jobs market and business confidence appeared to be moving in the right direction.
Carleen Keleman, chairman of the Institute of Directors in Devon and Cornwall, said: "After a great summer there's a warm glow in Devon and Cornwall that the prospects of sustained economic recovery are better than they have been for a number of years."
In a jibe at Labour, George Eustice, Conservative MP for Camborne and Redruth, said those calling for the Government to "borrow and spend even more have been proved wrong".
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But Labour accused the Chancellor of a "desperate attempt to rewrite history", and argued a flat-lining economy had "left ordinary families worse off".
In a speech at a building site in east London, Mr Osborne said switching economic policies away from austerity would be "disastrous".
Mr Osborne said that those – like Shadow Chancellor Ed Balls – who argued for a Plan B involving more state borrowing and less deep cuts have "lost the argument" because they were unable to explain the recovery of the past few months. But he warned "many billions" would still need to be cut after the next election – a direct challenge to Labour. "We cannot stop now," he said.
But Labour MP for Plymouth Moor View, Alison Seabeck, said: "The Chancellor is prematurely celebrating. People on low and medium incomes are still really struggling. A 'Plan B' would have seen the economy recover sooner."
The last few months have seen growth forecasts revised upwards amid a number of positive indicators – only months after economists feared the UK was set to plunge into an unprecedented triple-dip recession.
Mr Osborne, who deliberately avoided the phrase "green shoots" of recovery that saddled his predecessor Lord Lamont in the 1980s, said: "Thanks to the efforts and sacrifices of the British people, Britain is turning a corner. Many risks remain. These are still the early stages of recovery."
Revised gross domestic product figures show the UK economy grew by 0.7% in the second quarter of the year, with predictions it could reach 1% for the third quarter. But the economy remains 3% below its pre-crisis level.
The Royal Institute of Chartered Surveyors (RICS) today says the housing market in the South West is characterised by rising prices, more houses for sale and burgeoning buyer demand. Roger Punch, RICS residential spokesman for the South West, said: "We are seeing the recovery in the South West housing market continue."
Meanwhile, South West businesses are more confident about creating jobs in the final three months of the year than the rest of the country, according to recruitment firm Manpower. The South West recorded an outlook of +8% compared to +6% nationally. Andrew Shellard, operations manager at Manpower, said: "This has been driven by several factors including increasing confidence in the construction sector."
The Government said yesterday the increase of 91,000 private sector jobs in the South West since 2010 offsets the 53,000 reduction in the public sector.
And Lloyds' regional purchasing managers' index hit 61, with anything over 50 indicating business growth, the highest score seen since the series began over a decade ago. The South West recorded 61.9 – its highest ever.
The IoD's Ms Keleman hailed tourism, manufacturing exports and climbing numbers of start-up business numbers in Devon and Cornwall, but warned of uncertainty over the euro and Syria.
She added: "The speed of recovery is becoming less important than the sustainability of recovery and this is still heavily influenced by the continuing squeeze on household budgets and the expectation of normalising interest rates."
Mr Eustice MP added there are some very encouraging signs with growth and confidence returning and unemployment falling. "However, tough decisions on public spending had to be taken to prepare our economy for a return to growth," he said.