David Cameron has been forced to rewrite his Wednesday address to the Conservative Party conference after an early draft indicated that the prime minister wanted Britain's households to pay off their credit cards.
"Households - all of us - paying off the credit card and store card bills," the draft speech read.
According to PA, the comment sparked concern among retailers and economists, with the British Retail Consortium warning that urging people to "retrench" was "at odds with promoting growth".
According to Natalie Berg, an analyst at Planet Retail, Cameron’s call brought with it risks of further erosion to consumer sentiment and further stagnation.
Figures from the charity Credit Action show total UK personal debt stands at £1.45 trillion - more than the country’s entire gross domestic product (GDP). The interest paid daily by creditors is £175 million.
Cameron's aides said that the original speech was not meant to encourage the speedy payment of debt, but was supposed to encourage households to continue to manage their finances carefully.
The rewritten version is believed to highlight the country's suffering during the debt crisis. "That's why households are paying down their credit card and store card bills," Cameron is expected to say.
The prime minister is also expected to reassure the party faithful and the public at home that there is no need to change course on the economy even if the benefits are yet to be felt.
TUC General Secretary Brendan Barber said: “The economic news just keeps on getting worse. Today’s revision of the GDP growth figures show the economy is doing even more badly than expected. There is now a real danger of the UK going back into recession, and the best that current policies can deliver will be years of stagnation.
“We need action to kick start the economy, rather than speeches telling us to look on the bright side. The fall in household spending is almost as steep as at the height of the crash as wages are squeezed, prices rise and families cut back.
“Of course people should be sensible about paying back unsustainable debt, but the truth is that the government is relying on people borrowing more as OBR forecasts reveal. George Osborne must be hoping that people ignore the Prime Minister’s advice to pay back their credit cards today.”
Sara de Tute – President, The Credit Services Association (CSA):
“The Credit Services Association (CSA), the representative body of the UK debt collection industry, has welcomed the Prime Minister’s recognition of the vital role that professional collections agencies play in returning monies critical to the economy. Figures exclusive to the CSA and released today show that there is currently more than £50 billion under management by our Members (i.e. money in the process of being collected), which is the equivalent to almost half of the national healthcare budget and exceeds the total amount spent on defence.”
"It is more important than ever that in next month’s Autumn Statement the Chancellor introduces targeted VAT cuts and a clear strategy for growth to boost demand and help small businesses take on staff.”
"These deeply concerning figures show the British economy has stagnated since the autumn of last year, well before the eurozone crisis. They should set alarm bells ringing in Downing Street and the Treasury. They show things are even worse than we thought and that the economy has not grown at all for nine months.
"It is deeply out of touch for Ministers to claim Britain is a safe haven when our recovery was choked off last autumn, well before the problems in the eurozone and global markets of recent months.
"David Cameron and George Osborne urgently need to realise that spending cuts and tax rises which go too far and too fast have hit consumer confidence, killed the recovery and pushed up unemployment. This will just make it harder and harder to get the deficit down and the government is already set to borrow £46 billion more because of slower growth and higher unemployment.
"As today's figures show families struggling with higher food and energy prices, rising unemployment and the VAT rise are already struggling to get by and cutting back. They don't need an out of touch Prime Minister lecturing them about paying off their credit cards.
"What they do need is a Prime Minister and Chancellor with the strength to realise their plan is hurting but not working. There is a better way and Labour has set out a clear five point plan to create jobs, help struggling families and support small businesses. I hope that in his speech this afternoon David Cameron adopts one or more of these measures. He needs to come up with a plan for jobs and growth and he needs to do it fast."
|@ paulwaugh : A Plan B for the PM speech:No.10 sources say line will be "That's why household *are* paying down their ccard+store card bills"|
David Cameron has rewritten his speech to make it clear that he is not telling the public how to arrange their personal finances. An aide is in the press room now saying that the words released yesterday have been "misinterpreted" and that Cameron wanted to make the point that people are already paying off their debts.
|@ ToryPressHQ : Consumers are paying off credit cards. In January 2010 consumers owed £62.4 billion on credit cards. In August 2011 was £57 billion.|
He argues credit is crucial.
"In the short to medium term, if the consumer took the prime minister seriously, we’d be in real trouble."
|@ DPJHodges : ...in fairness to Ed, at least he got to deliver his speech before it started to unravel...|
They released a statement saying: "Primal Scream are totally disgusted that The Home Secretary Theresa May ended her speech at the Tory party conference with our song Rocks."
And rumour has it, in a nod to catgate, Cameron will exit the stage to the Cure's lovecats.
Baroness Warsi has just been on Sky News, apparently saying people "should" pay down their credit cards.
|@ MASieghart : Tory members being asked to move to fill 50 places where journalists haven't shown up. They don't want DC filmed going past empty seats.|
That’s why households are paying down their credit card and store card bills.
To make cat jokes
The PM mentions "leadership" 19 times
|@ ArifBBC : Not a "normal recession" but a "debt crisis". PM preparing people for longer term problems but hope ahead.|
|@ piersmorgan : Sorry Dave, but just won't wash blaming Labour for everything. People aren't dumb, they've only seen the economy get worse under you.|
Not going down that well on twitter...
|@ paulwaugh : Cam just name checked JCB as great British firm. I'm sure that's entirely unrelated to huge donations from Anthony Bamford.|
A couple of weeks ago I was up in the flat, going through some work before the start of the day and I saw this EU directive. Do you know what it was about? Whether people with diabetes should be allowed to drive. What’s that got to do with the single market?
|@ timloughton : Great to see how children & young people had been in from the start on the design and planning of The Zone My Place I opened in Nelson today|
"The Tory housing revolution is something that's very real and deliverable. Leadership, and the detail of what leadership means - in government and business. Those were the outstanding things for me. If Britain is to be great again in a new way, we all have to muck in together to get the country working again."
"It's been a realistic and optimistic conference and a realistic and optimistic speech from the Prime Minister", he told BBC 2's Daily Politics
|@ Tony_McNulty : Speech ultimately a car crash - written by a committee, clearly, with no personal stamp on it from DC.|
Miliband: "So I will take on the vested interests wherever they are because that is how we defend the public interest."
Cameron: "But if we put in the effort, correct those mistakes, confront those vested interests and take on the failed ideas of the past, then I know we can turn this ship around."
|@ christopherhope : #CPC2011 A Cabinet Minister tells me that Prime Minister David Cameron has a "very bad throat", which explains the poor delivery|
"Yet again we see the myth being peddled that the academies and Free Schools programmes are the answer to a good education in this country. The Prime Minister knows just as well as his education secretary that it is good leadership, teaching and proper funding which makes a difference in schools, not its status.
"Achieving a good education for all will be directly threatened by these programmes. Free Schools have been shown to entrench social division in Sweden. The academies programme, through their admissions and exclusions policies, will also threaten a fair education for all. It is the wrong route and it is a dangerous route which could see the break up of a coherent education policy in this country, which provides for a few not the many...
"The Prime Minister needs to be corrected on his perception that public sector pensions are ‘unaffordable’. The decision to cut public sector pensions is being made entirely for political, not economic reasons."
|@ RoryStewartUK : Great speech by Cameron this pm: particularly liked the emphasis on social justice, confidence (and Britannia in arms-bands)|
“This was a Tory speech to Tory England, with little relevant to Wales, and no answers to the real questions about the economy.
“With the UK economy having barely grown in the past nine months, David Cameron and George Osbourne have their heads in the sand if they think that their economic plans are working.
“It is more jobs that people in Wales need – and they aren’t getting those as a result of Labour’s failure to invest in the economy in Wales or the Conservative cuts coming from London.
“Instead, it is Plaid Cymru who are standing up for Wales by arguing strongly for investment in infrastructure in Wales to help our construction industry, such as the Build for Wales Programme we recommended when in government, and a cut in VAT to stimulate demand and production.”
“This has been a disappointing conference that has failed to respond to growing economic difficulties. If we judge people by what they do, rather than what they say, ministers believe that unemployment will be solved by getting tougher with the jobless and that they will restore economic growth by increasing the number of unfair dismissals.”
“It is important that the Prime Minister remembers that the lion’s share of apprenticeships reside in small businesses and so we urge him to ensure that deregulatory measures go further to allow small firms to offer more. Given today’s revision in GDP figures, the Prime Minister’s emphasis on leadership now needs to be accompanied by a clear and practical plan for growth", the FSB said in a statement.
"He looked so weary, with bags etched under his eyes and a slight hoarseness to his voice. It reminded me of a Doctor Who episode from a couple of years ago, where the Doctor brings down a government simply by using a prime minister’s tiredness to undermine their ability to govern."
|@ jameskirkup : No10 adamant DC does *not* have throat infection. So low-key, low-volume delivery was deliberate choice, in keeping with times etc.|
Asks Tim Montgomerie, who earlier this week complained about the government lacking a growth policy.
A Belgian bank has gone bust. Italy's being downgraded. American politics is in gridlock. I hoped this Conference would give us much more on growth. It didn't (although I may be underestimating the importance of credit easing).
Most of it was pitched at swing voters rather than the Tory faithful, from the reference to saving Nigerian babies to the praise for Dan Thompson, the man who started the “cleanup” movement on Twitter.
"This was no catflap gaffe, but a frightening revelation of economic illiteracy", she argues. Her colleague Jackie Ashley says it will most likely "sink without trace. without a trace".