Miliband urges emergency budget for jobs

Labour sought to increase pressure on the Government yesterday to change its economic policy by demanding an “emergency Budget” to promote jobs and growth.

Opposition leader Ed Miliband said the rise in unemployment to a 17-year high was the clearest sign a fresh approach was required.

Chancellor George Osborne is scheduled to set out his proposals to combat stalled growth in an Autumn Statement on November 29 but Mr Miliband and Shadow Chancellor Ed Balls said the country could not wait that long.

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In a visit to Futures Community College in Southend, where they met apprentices, they announced plans to tour the country promoting their own five-point plan which was launched at the Labour Conference and includes cutting VAT and a new tax on bankers’ bonuses which the party says would pay for 25,000 homes and jobs for 100,000 young people.

Mr Balls said while there were up-front costs – including the £12bn needed to fund a temporary cut in VAT to 17.5 per cent – there would also be benefits from the kick given to the economy.

On Wednesday Prime Minister David Cameron refused to budge from the coalition’s tough deficit-reduction strategy, claiming doing so would send the economy into a “tailspin”.

Mr Miliband accused him of being blind to the problems facing the UK: “Week by week, with every downgrade in growth, with every rise in unemployment we see, it is clear the Government’s plan is not working.

“Each and every day more than 1,200 people are becoming unemployed in this country and over 800 extra young people.

“That is an economic emergency and only a government so out of touch with what is happening in Britain’s factories and Britain’s high streets would fail to realise that.”

The Tories seized on comments by Mr Balls about the short-term cost of the five-point plan as proof Labour had abandoned its pre-election plans to halve the deficit in four years.

Matthew Hancock MP said: “Today Ed Balls finally admitted what he’s been denying for weeks – that his plan to deal with the debt crisis would mean more borrowing and more debt. Labour have abandoned the Darling plan, and now freely admit they would just keep spending on the taxpayer’s credit card.”