Osborne claims plans ‘paying off’ as UK on road to recovery

Chancellor George Osborne claimed Yorkshire is reaping the rewards of the Government’s economic plan after new figures showed the UK economy grew again in the third quarter of the year.

Chancellor George Osborne speaks with management trainee Robert Taylor during a visit to AW Hainsworth and Sons in Leeds

It is the first time the economy has grown for three quarters in a row for three years and the 0.8 per cent increase in output is the highest quarterly growth since the second quarter of 2010.

The figures were announced yesterday as the Chancellor visited textile manufacturer Hainsworth in Pudsey whose cloths are used to make uniforms worn by Buckingham Palace guards..

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Mr Osborne told the Yorkshire Post: “The good news is Britain’s hard work is paying off and it’s paying off here in Yorkshire and the rest of the country because we are on the path to prosperity but we have got to absolutely stick to the economic plan that is taking the tough decisions to create the jobs and see the economy growing here.”

Chancellor George Osborne speaks with management trainee Robert Taylor during a visit to AW Hainsworth and Sons in Leeds

However, a more cautious note was sounded by Deputy Prime Minister Nick Clegg who admitted many families are yet to feel the benefits of the recovery in their household budgets.

The Sheffield Hallam MP said: “For many people is doesn’t feel like a recovery until they feel actually they have got more money in their pocket and they don’t feel under so much pressure from the bills they have to pay every week and every month.”

He added: “I totally understand that if you are listening to these figures what does 0.8 per cent mean about the economy as a whole when you are faced with high petrol costs, heating costs, electricity bills, gas bills, you are worried about how to make ends meet from week to week, from month to month?”

Despite yesterday’s positive news, the size of the economy remains 2.5 per cent off the pre-recession peak of early 2008 and there were warnings the pace of growth could start to tail off.

Bank of England Governor Mark Carney warned on Thursday that growth was weighted heavily towards the household sector while investment and exports were lagging behind.

But he acknowledged the rate of growth was “towards the top end of the advanced economies”.

Shadow Chancellor Ed Balls said: “After three damaging years of flatlining, it’s both welcome and long overdue that our economy is growing again.

“But for millions of people across the country still seeing prices rising faster than their wages this is no recovery at all.

“Working people are on average over £1,500 a year worse off since David Cameron came to office, yet very high earners have enjoyed a huge tax cut.

“And on the cost of living, growth and the deficit, this Government have failed every test they set themselves in 2010.

“We now need action to secure a strong, balanced and sustainable recovery that works for the many, not just a few at the top.

“And simply to catch up all the lost ground since 2010 we would need 1.5 per cent growth in every quarter between now and the election.”

The latest figures split economists on the outlook for growth in the coming months.

Chris Williamson, chief economist at Markit, said: “Britain is booming again with the economy showing the most sustainable and robust-looking upturn since the financial crisis.”

But Alan Clarke of Scotiabank said the figure was a “tad 
disappointing” – given survey data indicating growth nearer one per cent – and “wasn’t a home run”.

The new figures showed the economy grew by 1.5 per cent over the last year, an improvement on the year-to-year rise of 1.3 per cent in the second quarter of 2013.