So says two high-ranking government officials who would know.
In a stark warning ahead of next month’s Budget, the Chancellor said there was little the Coalition could do to stimulate the economy.
Mr Osborne made it clear that due to the parlous state of the public finances the best hope for economic growth was to encourage businesses to flourish and hire more workers.
“The British Government has run out of money because all the money was spent in the good years,” the Chancellor said. “The money and the investment and the jobs need to come from the private sector.”
What should George Osborne do to provide a tax cut?
Tax the rich more to allow the income tax rate to be lifted to £10,000Borrow more and worry about reducing national debt in future yearsWe can’t afford any tax cuts
Mr Osborne’s bleak assessment echoes that of Liam Byrne, the former chief secretary to the Treasury, who bluntly joked that Labour had left Britain broke when he exited the Government in 2010.
He left David Laws, his successor, a one-line note saying: “Dear Chief Secretary, I’m afraid to tell you there’s no money left”.
Mr Osborne is under severe pressure to boost growth, amid signs the economy is slipping back into a recession.
Conservatives have been saying this for a generation. Government spending bankrupts us all. The private sector is where economic growth comes from. Government spending may give us something of a jolt (if any), but the cost associated with it is far more than if the government would just get out of the way and let the engine run.