Huge Levels Of Consumer Debt Damaging Economy - Cable

2.14.00pm BST (GMT +0100) Mon 8th Oct 2007

Commenting ahead of tomorrow's Pre-Budget Report and Comprehensive Spending Review, Liberal Democrat Shadow Chancellor and Deputy Leader, Vince Cable MP said: "After 10 years of Gordon Brown blithely ignoring the growing crisis of personal debt and irresponsible lending, the chickens are finally coming home to roost.

"Millions of people are feeling the effects of the high levels of personal debt, with the lowest levels of disposable income in 10 years and little economic optimism.

"Household debt is now 160% of income, double the level of a decade ago. The cost of servicing debt is close to the level that caused the recession at the end of the 1980s Lawson boom.

"Four years ago the Liberal Democrats raised concerns about the stability of an economy based on rapidly increasing consumer debt, but Gordon Brown claimed this was nothing more than alarmism.

"Yet, the Chancellor is likely to have to admit to the bleakest economic outlook since Labour came to power.

"Slow economic growth will inevitably hit spending on key public services as the tax take increases slower than expected.

"After 10 years of Gordon Brown being asleep on the job, the new Chancellor must feel he has been handed a poisoned chalice by the new Prime Minister."