GOVERNMENT spending in the UK will barely change before the next general election, according to research released today by the Centre for Economics and Business Research (CEBR).
The forecasters are expecting government spending to rise by 0.4 per cent this year, correcting with cuts of only 0.2 per cent in 2014 and 2015. Significant reductions will be stalled until 2016, when the CEBR predicts that cutting spending by 1.1 per cent will cause growth to cool.
The researchers expect a sluggish recovery, with growth not rising above 1.5 per cent for another half a decade, in 2018.
Scott Corfe, main author of the report, said: “Policymakers have effectively given up on reducing government spending in the short-term”.
He added: “It’s not until 2016 that spending cuts really start to bite, so we should expect some economic slowdown”.
In fact, according to the CEBR’s research, real government spending will be around 2.4 per cent higher at the time of the next general election in 2015 than it was in 2010.