Member Article

UK could suffer ‘zombie economy’

The UK could have a “zombie economy” with a jobless recovery from the recession if public spending is cut to tackle the deficit, a union leader has warned.

TUC general secretary Brendan Barber said taking the axe to public spending would have a “devastating” impact, increasing the risk of this country suffering a “lost decade”.

Mr Barber said recovery from the recession should be based on the construction of a low carbon economy and a fairer society that requires the super-rich to pay fair levels of tax.

He also called for a high pay commission to be set up to study “unacceptable” rewards for executives as well as bonus schemes.

Mr Barber said: “In the long term, Britain’s public debt is unsustainable and will have to come down before the gilt markets go on strike. But in the here and now, it is a distraction from the critical economic challenges we face.

“Public spending is the only motor of growth currently available to us. Swingeing cuts would increase the risk of Britain suffering a Japanese-style lost decade, would mean the unwelcome prospect of a jobless recovery, and would lead to the emergence of a so-called Zombie economy.

“Not quite dead - but not exactly alive and kicking either, and the consequences would be devastating.

“This country would be set back years, if not decades.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .