According to the Centre for Economics and Business Research, those regions with high level of public expenditure as share of GDP may be de-coupled from economic recovery as the government has to rebalance its books.
In their latest analysis - which was largely ignored by the Welsh press - the economic consultancy group predicted that whilst the Welsh economy may be partially cushioned this year because of its high dependency on the public sector, the medium term prospects are somewhat different.
With forecasted cuts of £80 billion to ensure that the UK’s public sector finances are balanced, those regions that are most reliant on public spending which will suffer the most. According to the CEBR, two thirds of our national prosperity is dependent on the public sector.
Whilst regions such as London will grow by 1.1 per cent during 2010-2013, Wales is forecasted to grow by only 0.7 per cent over the same period.
Perhaps more telling is CEBR’s advice that only a concerted effort to promote entrepreneurship and support private sector growth can prevent Wales from falling further behind the more prosperous parts of the United Kingdom.
Shame therefore that this particular Assembly Government has cut funding for economic development, created one of the most bureucratic business support systems in the UK, refused to re-establish the Entrepreneurship Action Plan for Wales and pushed out the private sector from any real involvement within European Structural Funds of nearly £2 billion.
In their latest analysis - which was largely ignored by the Welsh press - the economic consultancy group predicted that whilst the Welsh economy may be partially cushioned this year because of its high dependency on the public sector, the medium term prospects are somewhat different.
With forecasted cuts of £80 billion to ensure that the UK’s public sector finances are balanced, those regions that are most reliant on public spending which will suffer the most. According to the CEBR, two thirds of our national prosperity is dependent on the public sector.
Whilst regions such as London will grow by 1.1 per cent during 2010-2013, Wales is forecasted to grow by only 0.7 per cent over the same period.
Perhaps more telling is CEBR’s advice that only a concerted effort to promote entrepreneurship and support private sector growth can prevent Wales from falling further behind the more prosperous parts of the United Kingdom.
Shame therefore that this particular Assembly Government has cut funding for economic development, created one of the most bureucratic business support systems in the UK, refused to re-establish the Entrepreneurship Action Plan for Wales and pushed out the private sector from any real involvement within European Structural Funds of nearly £2 billion.
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