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• The week kicked off with continued reaction to the decision over the weekend of credit rating agency Moody’s to downgrade Britain’s credit rating from triple-A to AA1.
Opinion was divided over how much the downgrade really mattered economically, but the political damage it caused the government was undeniable.
The Conservative Party had, after all, included in its 2010 election manifesto the following: “We will safeguard Britain’s credit rating with a credible plan to eliminate the bulk of the structural deficit over a Parliament…”
Left Foot Forward looked at how the coalition is to blame for the downgrade, but we acknowledged that it was more damaging politically than economically. We also looked at how credit rating agencies have got in wrong in the past, most notably in the case of Iceland.
• Confusion reigned in Italy on Tuesday as no clear winner emerged from the country’s elections.
In terms of share of the vote, the centre-left coalition is set for 29.55%, fractionally ahead of Silvio Berlusconi’s centre-right alliance on 29.18%, with charismatic comedian Beppe Grillo on 25.54% and Mario Monti on 10.56%, while in the Senate,Pier Luigi Bersani’s bloc stands at 31.7%, with Berlusconi on 30.65%, Grillo on 23.77%, and Monti on 9.15%.
Uncertainty, fear and bewilderment stalk the streets following an election in which the system failed to produce any outright winners, reported our man in Italy, Shamik Das.
• On Wednesday the Office for National Statistics released its second estimate of GDP growth for the fourth quarter of 2012, which, along with small upward revisions to Q1 and Q3, raised overall growth in 2012 from 0.0% to a modest 0.3%
Yet putting this in the context of Office for Budget Resposibility’s 2010 predictions, the figures looked astonishingly poor. 2012 was supposed to be a year of booming recovery with growth of 2.8%. Not 0.3%
Left Foot Forward put the latest figures in context by looking back at the coalition’s broken promises on the economy.
Progressive of the Week:
Caroline Lucas, the Green Party MP for Brighton Pavilion, has put down an urgent ‘prayer’ in Parliament – like an Early Day Motion – calling for the Section 75 regulations of the government’s Health and Social Care Act to be annulled.
Under regulations published earlier this month under Section 75, nearly all commissioning done by the National Commissioning Board (NCB) and Clinical Commissioning Groups (CCGs) is to be carried out through competitive markets.
Ed Miliband has now got on board as top signatory, and Caroline is urging MPs “who feel strongly about safeguarding the future of the NHS“ to sign the joint motion.
Regressive of the week:
British Gas caused consternation among consumers this week after it announced bumper profits of £606 million for 2012 – 11% up on a year earlier – so soon after it increased its prices by 6% in November 2012.
This prompted Labour to call for the introduction of a tough regulator to ensure that savings in wholesale gas prices were passed on to customers.
Left Foot Forward put together some easily digestible facts about the great energy rip-off.
Evidence of the Week:
The Financial Times produced a blinding set of graphs on Wednesday highlighting how fiscal austerity has had a negative impacted on the GDP of various European economies.
The coup de grace was delivered near the end of the piece by Paul Krugman: “Austerity was costly for the afflicted economies: the greater the tightening between 2009 and 2012, according to the International Monetary Fund, the bigger the fall in output.”