George Osbourne's favorite group the IMF has downgraded the growth figure for the UK economy to just 1.1% for this year and only 1.7% for the next financial year.
The gloomy outlook should make Chancellor George Osborne rethink his tough programme of spending cuts and tax increases for the many and tax cuts for big corporations, even the IMF who had previously given full backing to his austerity measures are now calling for a softening of Osbournes approach.
The Chancellor's deficit reduction plans have been challenged by business leaders, economists and opposition politicians in recent months as the economic outlook for the UK deteriorates.
The IMF said the UK will continue to struggle and advised that a slower pace of deficit reduction would be necessary were the economy to continue to expand less rapidly than expected.
So, even George Osbourne favorite financial group now supports action to support growth. The coalition government despite huge public sector cuts and tax increases still has £12billion structural deficit higher then they predicted, this will worsen if growth stays low.
The real issue here is despite all the pain, the CONDEM government will borrow the same or slightly more than Labour and next year Labour's plan would have seen borrowing fall, but if the IMF claim the budget deficit will be 1.4% higher under the CONDEMs.
The CONDEMs medicine isn't working, in the IMFs own words we are now facing a “lost decade” (the IMF’s words) and growth is being serially downgraded, we need a change of course and we need it now.