UK growth forecast 'cut to -0.7%'

The respected financial think-tank the OECD has revised down Britain's growth for this year from 0.5% to -0.7%.

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Osborne insists there are 'positive signs' for UK economy

Despite the downgrading of the OECD's forecast, Chancellor George Osborne this evening insisted there were "positive signs" in the UK economy.

Mr Osborne told a CBI Scotland dinner in Glasgow:

The economic outlook remains uncertain but there are some positive signs.

Our economy is healing - jobs are being created, manufacturing and exports have grown as a share of our economy, our trade with the emerging world is soaring, inflation is down, much of the necessary deleveraging in our banking system has been achieved, and the world is once again investing in Britain.

Miliband: 'UK must shift to a more highly skilled economy'

Britain must shift to a more highly skilled economy in a bid to ease the burden on the squeezed middle, Labour leader Ed Miliband said today.

The next Labour government would not be able to simply increase tax credits for the less well-off as it did during the Gordon Brown years, he said.

Labour Leader Ed Miliband. Credit: Pool

Instead, the UK had to move away from its "low-wage economy" so that workers were better paid and could help stimulate economic growth, Mr Miliband told a conference at the London Stock Exchange.

"The redistribution of the last Labour government relied on revenue which the next Labour government will not enjoy," he said.

"The option of simply increasing tax credits in the way we did before will not be open to us."

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Labour: 'OECD figures show Govt policies have failed'

Responding to the growth forecast published by the OECD, Shadow Chief Secretary to the Treasury Rachel Reeves said: "These very concerning forecasts show just how badly the Government's economic policies have failed. Britain's growth forecasts have been slashed by more than any other major economy.

Shadow Chief Secretary to the Treasury Rachel Reeves. Credit: ITV

"And while Ministers desperately try to blame allour problems on the Eurozone crisis, the OECD says France and Germany are doingbetter than us.

"In fact Britain is one of just two G20 countries in adouble-dip recession.

"David Cameron and George Osborne need to stop clinging on to their failed economic plan and change course now. Without a serious plan for jobs and growth we won't get the deficit down and yet more long term damage will be done."

No 10: 'These are difficult times in the world economy'

Commenting on the OECD forecast, which put the UK's growth forecast at -0.7%, the Prime Minister's official spokesman said:

Those figures demonstrate what we know which is that these are very difficult times in the world economy.

The OECD highlights the euro area crisis as the single biggest global economic risk and in addition to that problem that UK is dealing with some deep-rooted issues at home.

All the evidence shows that recovery from financial crisis takes a long time and there is no doubt we still have an impaired banking and financial system in this country.

Clearly it is going to be difficult for us in this country while there are continuing problems in the eurozone.

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Labour: 'We need more change not less'

"We need more change, not less," Ed Miliband and Ed Balls will say during a speech at the London Stock Exchange today, as they set out Labour's three new agendas for economic change:

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