The three main political parties all agree the UK deficit is high and needs to be brought down. All agree that it is easier to get a deficit down if you have faster growth, cutting unemployment-related costs and raising revenues.

The government would also be wise to press on with its further measures to promote growth, as it will want to outperform the low figures in this outlook. This will mean delivering measures to ease money and credit and to stimulate demand.

The UK downgrade will come as little surprise to many. It does not appear to be occurring because the UK is cutting its deficit too far and too fast.

John Redwood Quotes