Cameron sees no end to austerity - report

LONDON Thu Jul 19, 2012 2:55am BST

Britain's Prime Minister David Cameron speaks at the Farnborough Airshow 2012 in southern England July 9, 2012. REUTERS/Luke MacGregor

Britain's Prime Minister David Cameron speaks at the Farnborough Airshow 2012 in southern England July 9, 2012.

Credit: Reuters/Luke MacGregor

Related Topics

LONDON (Reuters) - Prime Minister David Cameron said on Thursday that he cannot see an end to the government's austerity programme while Britain tackles its huge budget deficit amid deteriorating economic conditions.

Cameron indicated that Britain's programme of spending cuts, initially planned to take five years, could last until 2020.

"This is a period for all countries, not just in Europe, but I think you will see it in America too, where we have to deal with our deficits and we have to have sustainable debts. I can't see any time soon when ... the pressure will be off," Cameron said in an interview with the Daily Telegraph.

When the Conservative/Liberal Democratic coalition took power in 2010, it introduced an austerity programme of increased spending cuts and tax increases that was intended to finish by 2015.

The programme was extended to 2017 late last year, however, and is expected to save the government about 110 billion pounds in total.

"I don't see a time when difficult spending choices are going to go away ... we are in a very difficult situation," said Cameron.

Britain's budget deficit peaked at over 156 billion pounds in 2009/10 or 11 percent of GDP.

"I don't deny for a minute that it is a lot tougher than the forecasters were expecting," he said.

In a broad interview, covering, among other subjects, the economy, the coalition and the Olympic Games, Cameron said it had been a "very tough time to be in Government."

Britain was hit hard by the 2007-2009 financial crisis and had to spend tens of billions to bailout major banks.

The recovery from the steep slump has been weak, with stuttered growth, soaring unemployment and a squeeze on living conditions and household budgets for ordinary Britons.

"We've had one of the longest and deepest recessions for decades in Britain. It was an incredibly tough set of circumstances and it has proved very hard to get out of those situations," he said.

On the issue of Europe, Cameron said he did not believe that Britain should leave the EU and that he would never campaign for an "out" vote in any referendum.

He indicated that he would seek to negotiate a "new settlement" with Europe, which will be put to a referendum rather than offering an in-out vote.

(Reporting by Stephen Mangan; Editing by Peter Cooney)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see
Comments (2)
Naveen_Kalyani wrote:
“Cameron sees no end to austerity – report”, this is not at all the perfect solution to end to a deficit predicament in any economy.

Why? Check these ones- and

Jul 19, 2012 7:39am BST  --  Report as abuse
margaretbowker wrote:
There has been media anxiety that PM, David Cameron’s assessment is too pessimistic, but it seems logical that austerity will continue as long as markets and economic conditions demand it. The most effective, non-debt increasing way to ameliorate the situation is an effective growth strategy. The three immediate and medium term pillars have now been put in place over the last week, and the strategy is waiting for its fourth, private and corporate investment, which hopefully, with an encouraging environment of incentives and regulation smoothing, will begin this summer. Austerity is a given, but lower inflation, lower unemployment, much lower in time, greater revenues, less benefit outlay, greater consumer confidence and more diversity in export markets are all either happening, or achievable. Being realistic, but concentrating on growth will work.

Jul 19, 2012 12:39pm BST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.