UK austerity ‘could last until 2020′

<p>Austerity could remain in vogue in the UK for many years.</p>

Austerity could be on the agenda for the UK for many years to come, a new report has warned.

The Institute for Fiscal Studies and the Institute for Government pointed out that the budget deficit target is as far away today as it was in 2010, when the coalition government came to power pledging to cut the deficit through its austerity programme.

Chancellor of the exchequer George Osborne is committed to his austerity programme and his opposite number Ed Balls recently stated in a major speech that he would stick to the Conservative MP's spending plan initially if Labour wins the next general election.

But the International Monetary Policy has regularly called for Mr Osborne to change his course, warning economic growth is being damaged by his cuts.

"It would not be surprising if not just 2015 but also 2020 was an 'austerity' election," said the Institute for Fiscal Studies and the Institute for Government in a joint report.

The UK narrowly avoided a triple-dip recession earlier this year by recording growth of 0.3 per cent for the first quarter.

Find up to date information on the FTSE 100 and spread betting strategies at City Index

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.