Chancellor George Osborne has warned that the UK is set to face one of the toughest financial years since the financial crisis was declared in 2007.
He has stated that the slowing global economy is to blame, and that the UK is not out of the woods yet when it comes to financial growth, stating that “2016 is the year of mission critical”.
This is a very different message to the one he was giving in his Autumn Statement last year, when he stated that the UK economy was healthy and “growing fast”. In a bid to create more jobs, the Chancellor’s statement had intended to make businesses more competitive to make the economy more productive.
Is the Economy Really Under Pressure?
Mr Osborne has pledged to highlight the risks that the UK economy will face during the next 12 months. Especially as this new announcement is sure to make people all over the UK begin to worry about their finances again, after being assured that things were looking up for the economy.
In response to his Autumn Statement backtrack, the Chancellor has stated that he is still having to face “difficult decisions” with regards to Britain’s finances.
“It is precisely because we live in an uncertain world. It is precisely because we have not abolished boom and bust as a nation, that you need to take these steps, difficult steps and I need to go explaining to the public, that the difficult times aren’t over, we have got to go on making the difficult decisions, precisely so that Britain can continue to enjoy the low unemployment and the rising wages that we see at the moment,” he told BBC Radio 4’s Today programme,
Not a “Debt Fuelled Recovery”
With an interest rate rise expected to come at some point during 2016- the first rise since 2007, many people are worried that the Chancellor is putting too much pressure on the Bank of England to up the interest rates to help boost the economy further out of the danger zone.
However, Mr Osborne has denied this. Suggesting that an interest rate rise is a good sign that things are finally normalising after such a huge financial crisis. The Treasury has also highlighted that the rise in interest rates is not up to the Chancellor, with the decision being made solely by the Bank of England themselves.
With so much uncertainty, it’s understandable that many people are beginning to worry about their financial position. That’s where our financial advisors in Lancaster come into their own; with 10 years of experience behind us, we’re able to provide each and every one of our clients with friendly, helpful and first rate advice that is tailored to each of their specific circumstances.
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