There is ample room for debate about the appropriate size and role for the government in the longer term, but – in the absence of adequate demand from the private sector – a substantial fiscal consolidation in the shorter term could add to the headwinds facing economic growth and hiring.
This morning I would like to talk about the importance of investment in helping deliver that prosperity. It is through investment that firms develop new products, find better ways of doing things and expand their productive capacity. This means that the investment climate and the level and nature of investment have an important bearing on our future prosperity.