Osborne defends UK spending cuts, banking system

Chancellor George Osborne defended the government’s spending cuts in a newspaper interview on Thursday, saying they pulled the country’s finances out of the “firing line.” Skip related content

In an interview with The Times, Osborne also said the country’s banking system is fit to withstand new shocks.

“People are talking about other countries in Europe at the moment, they are not talking about Britain,” Osborne told the newspaper during a visit to Hong Kong.

“If we had not taken the action we have taken in the last six months, we absolutely would be in the firing line.”

Last month, Osborne outlined a five-year austerity drive, including major cuts to welfare and other government expenditure, to reduce a record peacetime budget deficit of 11 percent of gross domestic product.

Osborne said worries about the stability of the Irish, Greek and Spanish public finances would not have an impact on the British banking system.

“I think the British banking system is now well-capitalised, we are aware of all the risks,” he said, adding that July’s stress tests of how European banks would cope with another recession showed British banks to be “remarkably well-placed” compared with some of their counterparts. Osborne, who was part of a trade mission to China this week, dismissed suggestions that the relatively low value of the deals struck in Beijing had been a failure.

“There is a lot to be optimistic about,” he said.
Source: Reuters