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British finance minister George Osborne must urgently form a plan to rectify the country's recession-hit economy after it shrank alarmingly in the second quarter, AFP reports citing the country's press. The under-pressure chancellor has to decide immediately whether to stick to his fiscal austerity drive or loosen the purse strings in order to stimulate the economy, which contracted by 0.7 percent in the second quarter. "Osborne reeling as economy enters the disaster zone," said the Guardian, a proponent of public spending. "The economic model inherited by the coalition was severely rickety... but the promises from (Prime Minister David) Cameron and (Deputy Prime Minister) Nick Clegg that they would 'rebalance' the economy have come to naught," said its editorial. "Economic conditions for Britain are unlikely drastically to improve any time soon; and Mr Osborne gives no indication of having a plan to face the coming squall," it added. The worse than expected downturn came on the back off steep falls in the construction and manufacturing sectors. The centre-right Times said the government had a "few months" to decide whether to adjust its plans. "The task now is different and even more difficult than the one the coalition inherited two and a half years ago," argued its leading article. "It requires the Government to revisit all the assumptions that lie behind its economic policy and, casting aside short-term political considerations, to set out a plan that retains confidence in the public finances but also finally offers a meaningful agenda for growth," it concluded. The pro-Conservative Daily Telegraph splashed "Osborne under attack as recession deepens" across its front page. Commentator Iain Martin warned Osborne had six months to rectify the economy or face dire consequences. "This summer feels increasingly like the economic equivalent of the calm before an almighty euro-related storm, a little like July 1914 must have felt when hell was about to be unleashed," he wrote in a Telegraph blog. "It would be good to have confidence that the UK government is on top of the situation and to believe that the PM understands how to lead the country out of this mess. But really, God help us all." The Financial Times highlighted the negative drag caused by the eurozone turmoil, but urged Osborne to exercise his power more forcefully. "This (eurozone crisis) is no excuse for the chancellor to sit on his hands," it stressed. "In counteracting the present stagnation, he must use more of the levers at his disposal." The downbeat data was published two days before the 2012 Olympic Games opens in London, an event many hope will give a boost to the struggling economy.
British finance minister George Osborne must urgently form a plan to rectify the country's recession-hit economy after it shrank alarmingly in the second quarter, AFP reports citing the country's press.
The under-pressure chancellor has to decide immediately whether to stick to his fiscal austerity drive or loosen the purse strings in order to stimulate the economy, which contracted by 0.7 percent in the second quarter.
"Osborne reeling as economy enters the disaster zone," said the Guardian, a proponent of public spending.
"The economic model inherited by the coalition was severely rickety... but the promises from (Prime Minister David) Cameron and (Deputy Prime Minister) Nick Clegg that they would 'rebalance' the economy have come to naught," said its editorial.
"Economic conditions for Britain are unlikely drastically to improve any time soon; and Mr Osborne gives no indication of having a plan to face the coming squall," it added.
The worse than expected downturn came on the back off steep falls in the construction and manufacturing sectors.
The centre-right Times said the government had a "few months" to decide whether to adjust its plans.
"The task now is different and even more difficult than the one the coalition inherited two and a half years ago," argued its leading article.
"It requires the Government to revisit all the assumptions that lie behind its economic policy and, casting aside short-term political considerations, to set out a plan that retains confidence in the public finances but also finally offers a meaningful agenda for growth," it concluded.
The pro-Conservative Daily Telegraph splashed "Osborne under attack as recession deepens" across its front page.
Commentator Iain Martin warned Osborne had six months to rectify the economy or face dire consequences.
"This summer feels increasingly like the economic equivalent of the calm before an almighty euro-related storm, a little like July 1914 must have felt when hell was about to be unleashed," he wrote in a Telegraph blog.
"It would be good to have confidence that the UK government is on top of the situation and to believe that the PM understands how to lead the country out of this mess. But really, God help us all."
The Financial Times highlighted the negative drag caused by the eurozone turmoil, but urged Osborne to exercise his power more forcefully.
"This (eurozone crisis) is no excuse for the chancellor to sit on his hands," it stressed. "In counteracting the present stagnation, he must use more of the levers at his disposal."
The downbeat data was published two days before the 2012 Olympic Games opens in London, an event many hope will give a boost to the struggling economy.
