Tory cuts will lead to economic ‘nose dive’ say unions

By Liz Stephens

The Conservatives’ plans to scale back public sector spending if they win the next election could lead to mass industrial action and a double dip recession, according to the Trades Union Congress (TUC).

A report by the organisation which analysed the potential effects of the possible spending cuts said that areas such as Liverpool, Leicester and Middlesbrough would see unemployment increasing by almost 40 per cent.

Countrywide, the cuts could push unemployment to four million, warned the TUC.

General secretary Brendan Barber described the potential spending cuts as “pure economic masochism” that would “scar for life a whole generation of young people”.

Mr Barber also rejected claims that the UK is pulling out of recession, saying that will only be evident when unemployment levels begin to fall.

He warned that the unemployment caused by the Tories’ proposals would cause the economy to “nosedive back into recession”.

Speaking at the TUC conference in Liverpool, Mr Barber also appeared to hint that large scale civil unrest could another outcome: “Here in this city which was so scared by the riots of the 1980s, let us remember the crippling economic and social costs of the Tory recessions and let us resolve: never, ever, again.”

However, yesterday a YouGov poll for the Sunday Times found that 60 per cent of those polled favoured budget cuts to balance the books ahead of heavier taxation.

The news comes as business secretary Peter Mandelson is due to give a speech outlining the government’s spending strategy at the London School of Economics.

He will say the government will be “wise spenders, not big spenders” and stress that Labour plans to continue with the planned economic stimulus package – which has been the source of recent condemnation by France and Germany as well as the Tories.