Cameron, Clegg See U.K. Economy ‘Healing’ as Deficit Cut

Prime Minister David Cameron and his deputy Nick Clegg, announcing new priorities for their governing coalition, said the U.K. economy is “healing” as they vowed to push ahead with deficit-reduction plans.

“I am confident the British economy is healing; I am confident we are doing the right things to tackle the black hole in the public finances,” Liberal Democrat leader Clegg said at a news conference, after the leaders were asked if they could see growth returning after suffering a double-dip recession. “Of course we want the healing process to take place faster, but look at the headwinds we’re having to deal with,” such as the crisis in the euro area and consumer debt, he said.

Cameron, who leads the Conservative Party, and Clegg were highlighting their shared agenda in Cameron’s Downing Street office as they published a “Mid-Term Review” summing up the government’s achievements since 2010 and setting out policies to take them to the next election in 2015. It is more than 2 1/2 years since they gave a joint news conference in the rose garden at the London residence to mark the formation of the coalition.

The 46-page document published today, titled “The Coalition: Together in the National Interest,” says detailed plans will be published before the summer for public spending for the 2015-16 fiscal year. Any spending or deficit-reduction plans made then will outlive the current coalition commitment that runs to the election in May 2015.

Cameron said the coalition had confounded expectations that it would not last much beyond the fall of 2010.

‘Determined Leadership’

“Some people thought our coalition wouldn’t make it through our first Christmas, but this government is now well into its third year, because this coalition was not and is not some short-term arrangement,” he told reporters. “It is a serious five-year commitment to give our country strong, stable and determined leadership that we need for the long term.”

The rose-garden news conference was portrayed at the time as the celebration of a “marriage” between the two parties. Cameron sought to move away from that imagery today, conjuring up instead a picture of British television advertisements for Ronseal, a wood varnish that “does what it says on the tin.”

“To me it’s not a marriage, it is, if you like, a Ronseal deal; it does what it says on the tin,” Cameron said. “We said we would come together, we said we would form a government, we said we would tackle these problems, we said we would get on with it in a mature and sensible way, and that is exactly what we’ve done.”

Asked whether the coalition would see out the full five-year parliamentary term up until May 2015, Cameron said: “For me, absolutely.”

Before it's here, it's on the Bloomberg Terminal.