Ruth Porter spoke to Tony Livesey about yesterday's borrowing figures and how the government is handling the economy. She disputed that we are in the middle of austerity, as whilst the government have implemented tax increases such as the VAT rise, we haven't seen many spending cuts.
She argued that the Coalition needs to focus on making it easier to do business in Britain. The private sector wants to get out there, with initiatives such as the third runway or with building new houses, which would help with economic problems, but planning regulations are very restricted. The government should have taken action but backed down because of public opinion.
She also discussed productivity. Despite employment figures taking a turn for the better, we are still not seeing economic growth which suggests a productivity problem. This is related to the disincentive that benefits and high marginal tax rates create. Freezing the former and cutting the latter would likely improve productivity.
Listen here. Segment starts at 11.12.