Economy is too fragile to handle cuts, Osborne warned

A leading economic think-tank today urged George Osborne to delay the dramatic public sector cuts which underpin his economic policies, and to u-turn on them completely if the economy falters again.

The National Institute for Economic and Social Research (NIESR) urges the Chancellor to "ease off" spending cuts and consider tax rebates if the economy shows signs of a further sharp slowdown, the Independent reports. It says there is "a case for delaying some of the austerity programme but accelerating planned increases in the state pension age". If cuts cannot be made, either taxes should rise now or in the near future, the NIESR says, where the economy has shown to have recovered. If the economy stumbles, it suggests a policy u-turn instead. In its grim analysis, the think-...