TUC warns of economy 'stagnation'


Frances O'Grady

The UK faces a lost decade of economic "stagnation" because of the current rate of growth, the TUC has warned.

A study by the union organisation showed that rising population has been the driving force behind economic growth in recent years.

But GDP income per head is lower than when the coalition Government took office in 2010 and will not return to its pre-recession level until 2018 at the current rate, said the TUC.

General secretary Frances O'Grady said: "After years of recession and stagnation, prolonged by painful austerity, the Government has been quick to claim we are back in recovery.
"But if the economy continues to grow at its current rate, it will still take nearly five more years to get back to where we were in 2007. That doesn't sound like much of a recovery.

"Too many people are having to run down their savings or turn to credit cards to spend in the shops, rather than see their incomes grow, and behind improving employment figures are millions of workers whose incomes are falling and who can't get enough hours to make ends meet.

"We all want to see the UK economy back on track but any talk of recovery is meaningless unless we get the right kind of growth."

A Treasury spokesman said: "The economy is on the mend, as confirmed by the latest GDP data showing balanced growth across the economy, but there is still a long way to go as we recover from the worst economic crisis in living memory.

"The Government has taken continued action to help people who work hard and want to get on. Increasing the personal allowance has taken 2.4 million people out of tax altogether and saves a typical taxpayer almost £600, freezing fuel duty has kept prices 13p per litre cheaper than they would otherwise have been and freezing council tax for each year of this Parliament will save a typical household £600."

© 2013 Press Association