Alistair Darling optimistic for the future of the UK economy
- 00:01:22
- ITN
Alistair Darling optimistic for the future of the UK economy
Chancellor Alistair Darling has expressed confidence that Britain is on the road to economic recovery. Delivering his annual Mansion House speech to the City, he warned the banks that they needed a "change of culture" in the wake of the financial crisis. He said the latest evidence on the economy was in line with his widely-criticised Budget forecast in April that Britain would return to growth around the turn of the year. The Chancellor said: "There is growing evidence that the steps taken, at home and internationally, are stabilising the banking system and supporting our economies. "And this is in line with my Budget forecast for growth around the turn of the year - and my confidence in the strength and resilience of the British economy in the medium-term. While I am cautious, I also remain confident." Turning to the banking sector, he said: "We need a change of culture. Their focus must be long-term wealth creation, not short-term profits." The Governor of the Bank of England, Mervyn King, earlier said banks should draw up "wills" planning for an orderly wind-down of their businesses if disaster strikes. Mr King suggested institutions should be required to produce an assessment of their affairs to help authorities in the event of their collapse. He also said the financial sector would have to work hard to regain the trust of people outside the industry. He said families and businesses had been told that a market economy was "essential" for prosperity, adding: "But out of the blue - in this case the financial sector - came a crisis that did not stem from weakness in the real economy. It has wreaked havoc on those same businesses and families." Mr King said there were signs that the UK economy was "beginning to stabilise" but warned there could be a long road to recovery. He reiterated his support for the Government's decision to step in to help the crumbling banking sector but warned: "Five years from now, national debt, as a proportion of national income, is expected to be more than double its level before the crisis."
ITN | June 17, 2009
