The National Institute of Economic and Social Research (NIESR) says that the UK economy will contract by 0.5 per cent this year and then grow by 1.3 per cent in 2013 and by 2.4 per cent in 2014. NIESR says that had the austerity measures been delayed from 2011 to 2014, the economy would have delivered £239 billion more economic output and a200,000 jobs could have been saved The think-tank also warns that austerity measures may have cost the UK's GDP up to 16.5 per cent in cumulative economic growth. NIESR has cut its growth forecast from zero to a contraction of 0.5 per cent and states that had the austerity measures been delayed this year, the UK economy would have grown steadily. The report calls for investment in key infrastructure projects. The research paper says that even with delaying the cuts, the government could meet its target of eliminating the current budget deficit by 2016-17 because even though borrowing this year will exceed the borrowing estimate given by the Office for Budget Responsibility (OBR), this is “largely a cyclical rather than a structural phenomenon.”Source: The Coming Crisis
