By Vittorio Hernandez

London, England, United Kingdom

Despite the expected tougher times ahead, British Chancellor George Osborne insists that the United Kingdom will stick with its austerity plan.

Osborne told Parliament that the coalition government has only one plan, which is one that is an absolutely unwavering commitment to fiscal responsibility and deficit reduction.

He pointed out that the deficit-reduction plan, which has been criticized by Britons and the opposition, made Britain a safe haven in the ongoing global debt storm. However, Osborne admitted that because of the cost-cutting measures, Britain's recover would be slower than expected.

He conceded growth forecast would need to be lowered again a day after Bank of England Governor Mervyn King warned that economic headwinds were becoming stronger by the day.

King said on Wednesday that he predicts a 1.5 percent gross domestic product growth rate for Britain, which is lower than the Office for Budget Responsibility's forecast of 1.7 percent economic expansion.

Osborne boasted that global events vindicated the coalition government and assured Britons the Conservative-led government will not abandon the country to the financial whirlpool.

However, Shadow Chancellor Ed Balls countered that Osborne is in deep denial about the weakness of the British economy.

He quoted renowned economist Paul Krugman who assessed that "the wolf is on Britain's door," while Osborne "believes it is the confidence fairy who is knocking."

 

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World - Britain Sticks With Austerity Plan | Global Viewpoint