UK Chancellor: 'The British Government Has Run Out Of Money'

Sanya Khetani

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In a bleak warning ahead of next month’s Budget, Chancellor George Osborne said there was little the coalition government could do to stimulate the economy.

“The British Government has run out of money because all the money was spent in the good years,” Osborne said, The Telegraph reports. “The money and the investment and the jobs need to come from the private sector.”

He said the best way to boost growth was to encourage businesses to do well and hire more.
Osborne is under severe pressure to boost growth, amid signs the economy is slipping back into a recession. The Institute of Fiscal Studies has urged him to institute emergency tax cuts in the Budget to combat the risk of a prolonged slump.

But the Chancellor said he would not borrow money to reduce taxes or increase spending. “Any tax cut would have to be paid for,” he told Sky News. But not everyone agrees with his proposal.

Osborne said this month he would stick to budget cuts that would see more than 700,000 public-sector jobs eliminated in the “tightest fiscal squeeze” since World War II, according to Bloomberg. The UK’s budget deficit equals nine percent of its GDP.