British Economy 'Out Of Intensive Care', Says Conservative Treasury Minister Sajid Javid

British Economy 'Out Of Intensive Care'
Javid warns that Labour policies would hugely increase borrowing
Javid warns that Labour policies would hugely increase borrowing
PA

The government's economic vision is gaining enough momentum to pull the country out of the recession, a Conservative Treasury minister said, following a series of positive economic figures.

Sajid Javid acknowledged there was "still a long way to go" to repair the damage but echoed Chancellor George Osborne in insisting the economy was "out of intensive care".

Javid warned that Labour's economic policies would push up borrowing by £50 billion and leave homeowners at risk of rising mortgage costs if interest rates could not be held down.

His comments came after warnings of a dire fall in Conservative Party membership. The party does not publish its national membership figures, but a number of senior party figures are worried the number may have fallen below 100,000, the first time in post-war history. Labour has 187,000 members.

The right-wing website, Conservative Home, has repeatedly called on the party to release its membership figures.

Writing in the Daily Telegraph, Javid said members and voters had confidence in the way the government was running the economy which "has moved out of intensive care and into recovery. The deficit is down by a third, private sector employment is at an all-time high and there are over 300,000 more small businesses.

"And our plan has ensured that we have kept mortgage rates low, while preventing a bond market crisis that would have destroyed businesses and jobs. We only have to look to our European neighbours to see what that would have been like.

"Yes, growth was slower than expected over the last two years, but the eurozone was in a mess and our economy was hit by a temporary oil price spike. Since those problems have abated - and subsequent monetary support by the Bank of England and the European Central Bank has taken effect - momentum has returned to our economy."

He used the op-ed, and a letter to Conservative party members, to launch a stinging attack on Labour, saying the opposition party had argued that the "only way to guarantee a recovery was through even more government borrowing" but shadow chancellor Ed Ball's argument has been "blown apart".

"Yet Ed Miliband and Ed Balls are still clinging on to this same old Labour policy. They still think, bizarrely, we could borrow less by borrowing more," Javid said.

"And for all Ed Miliband's promises of spending 'discipline', he's been too weak to stop his frontbenchers from making unfunded spending commitments that would mean even more borrowing than he admits.

"In fact, just this year alone, Labour have racked up a staggering £50 billion of spending commitments without saying how they would pay for them. That would mean £2,960 more borrowing and more debt for every working family in the country.

"If we were to adopt Labour's policy, we would send a message to the financial markets that we weren't serious about paying our way. It would spark a market crisis. Mortgage rates would soar - Bank of England figures show that if they rose by just 1%, homeowners' debt service bills would rise by £1,000 on average.

"Job losses and business insolvencies would follow. Hardworking people would pay the price for a Labour Party that hasn't changed."

Shadow economic secretary Cathy Jamieson said: "The Tories should explain why their failed economic policies have led to a cost of living crisis and £245 billion more borrowing than planned.

"They choked off the recovery three years ago and families are paying the price. Official forecasts show working people are set to lose an average of £6,660 after five years of David Cameron, yet millionaires have got a huge tax cut. As the Governor of the Bank of England warned this week, this is the slowest recovery on record.

"And once again the Tories have got their sums wrong. We have made no spending commitments for after the next election."

Close

What's Hot