Rachel Reeves MP, Labour’s Shadow Chief Secretary to the Treasury, responding to today’s public sector finance figures, said:
"After yesterday’s IMF report, these figures are another damaging blow to David Cameron and George Osborne’s failed economic plan. By choking off the recovery and pushing the economy into recession the Chancellor has ended up borrowing more – as we repeatedly warned.
"With the double-dip recession and rising long-term unemployment leading to a bigger benefits bill, the Government has now borrowed £4.5 billion more in the year so far than in the same period last year. This is a rise of 11.7 per cent, compared to the 4.6 per cent fall predicted at the time of the Budget. And this borrowing of £42.9 billion is the highest amount ever recorded in the first three months of any financial year.
"This all comes on top of the extra £150 billion the Government has already admitted it will have to borrow to pay for the costs of high unemployment and slow growth. Trying to raise taxes and cut spending too far and too fast has badly backfired and the Government’s pledge to balance the books by 2015 is now in tatters.
"We need tough decisions on tax, spending and pay but to succeed in getting the deficit down we also need a plan for jobs and growth. Unless the Chancellor takes urgent action to boost the economy now he will end up borrowing billions more to pay for economic failure and cause long-term damage too."