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Austerity wasn’t because of economic necessity but a political choice. The economic argument was that if you save your money/reduce your spend, you can clear your debt otherwise we were told we would end up like Greece. This view was accepted by Osborne resulting in this long period of austerity. It should be noted that in 2012 a report by IMF said that austerity had been a mistake. A better approach would have been to reflate the economy which would have left it in a better place to pay off the deficit. The report also said that the UK couldn’t end up like Greece because the debt was in its currency. The UK could raise loans through UK bonds (the problem with Greece is that they are in the Eurozone and share their currency with a number of countries, but there isn’t a euro bond. Each of the Eurozone countries still uses their own market to raise loans from bonds. External institutions who want to buy eurozone currency bonds are attracted to countries like Germany (although the interest rates are very low) while Greece has to significantly increase their interest rates to attract investors to buy their bonds, although it’s for the same currency.  The consequence of this is that Greece has youth unemployment near 50 per cent and Germany has youth unemployment close to 3 per cent because the bonds have to be serviced and interest paid on them).

This has been the most prolonged period of austerity post-war. The UK’s deficit peaked at 10% of GDP and Osborne in 2010 unveiled cuts of  £110 billions of fiscal cuts – public service cuts and tax increases (VAT). It wasn’t wholly a success as growth stagnated and unemployment rose. The Bank of England couldn’t reduce interest rates any further to stimulate the economy. Austerity measures did what austerity does, it contracted the economy, and this was the choice accepted by Osborne.