Downing Street Says

» Tuesday, April 22, 2008

Cabinet

The Prime Minister’s Spokesman (PMS) began by summarising this morning’s Cabinet discussions. Cabinet met for around one hour- there was the usual brief update on parliamentary business from the Chief Whip, a brief update of the situation in Zimbabwe from Lord Malloch-Brown, but most of the hour was taken up by a discussion on the economy led by the Prime Minister and the Chancellor.

The main message from the Prime Minister and the Chancellor was that of course it was understandable that people should be concerned about the economic situation at this time given the worsening global situation, but the Government had a clear strategy for dealing with this economic uncertainty and steering the country through this difficult period and addressing the concerns of the public.

On the concerns that people had about growth and employment, in the Budget we had stuck to our long term spending plans and had been able to increase borrowing to keep the economy growing.

On concerns about mortgage rates, yesterday the Bank of England with the Treasury’s support had injected £50billion of liquidity into financial markets with the aim of easing conditions in the mortgage markets. We had taken tough action on public sector pay including three-year pay deals for nurses, teachers and civil servants, and interest rates had been cut three times. The Chancellor explained that when he met mortgage lenders later today, he would be pressing them to see what more they could do such as by taking action when they could to pass on lower interest rates, and acting responsibly on those facing difficulty meeting their mortgage payments and re-financing their mortgages. Caroline Flint also explained what more the Government hoped to do in relation to shared equity schemes to help first time buyers in particular.

On concerns about higher fuel prices, the Prime Minister and Chancellor explained that we had frozen fuel duty and increased the winter fuel payments, and John Hutton had announced last week the extra help the Government working with the energy companies had been able to provide.

On concerns over higher food prices, the Prime Minister was meeting the Head of the World Food Programme the European Commission, and the Chief Executive of Sainsbury’s among others to discuss action that could be taken to deal with rising global food prices.

So Cabinet was overwhelmingly dominated by the economy, but the key message was the Prime Minister and the Chancellor emphasising that on each of the issues that the public had concerns about at the moment, the Government was taking actions to address those concerns.

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» Tuesday, April 22, 2008

Cabinet

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