Skip to main content
Mayor of London logo London Assembly logo
Home

Current Issues Note 26: Private sector recovery during fiscal cutbacks

Key information

Publication type: General

Publication date:

  • The UK has seen a huge increase in Government spending and borrowing which has produced the largest peacetime budget deficit ever. This cannot all be blamed on the 2008-09 recession.
  • Tighter fiscal policy will allow monetary policy to remain loose for longer, which will support business investment, consumption and net exports.
  • Academic research suggests that cutting Government expenditure is better then tax rises as a way to implement fiscal consolidation.
Back to table of contents

Related documents