U.K. Chief Secretary to the Treasury Danny Alexander said adopting the right policies for Britain is more important than the country’s credit rating.
His comments contrast with Chancellor of the Exchequer George Osborne’s emphasis on Britain’s top credit grade, which he has repeatedly cited to justify his fiscal-austerity program.
“The credit rating is not the be-all and end-all,” Alexander said on BBC Radio 4 today. “What matters is have we got the right policy mix for the country to get people back into work, to support economic growth, to deal with the huge problems in our public finances, and the credit agencies reflect on those things and the ratings they give are a reflection of the credibility of that mix.”
When Standard & Poor’s reaffirmed Britain’s AAA rating on July 27, Osborne issued a statement saying the decision was a vote of confidence in the U.K.
“On the day Britain welcomes the world to our country for the Olympic Games, this is a reminder that despite the economic problems we face, the world has confidence that we are dealing with them,” the chancellor said.
S&P said that the U.K. economy should begin to recover in the second half of this year and steadily strengthen, helping to reduce the budget deficit. The economy shrank 0.7 percent between April and June, extending the recession to nine months.