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Brown Accused Of 'big Lie' Over Public Finances While Darling Prompts Fears Of Fresh Tax Rises

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Brown accused of 'big lie' over public finances while Darling prompts fears of fresh tax rises

Alistair Darling said he would do 'whatever is necessary' to balance the books in his annual Mansion House speech

Gordon Brown was accused of a 'big lie' over Britain's battered public finances tonight as fears grew that more tax rises are on the way.

The Prime Minister was accused of misleading the Commons after claiming investment in schools and hospitals will grow until 2012 - apparently contradicting Labour's own Budget figures.

It came as Chancellor Alistair Darling prompted fears of fresh tax rises as he said he would do 'whatever is necessary' to balance the books in his annual Mansion House speech.

'No-one wants to put up taxes... but it is right to do it in a way that those most able to bear the burden make the greatest contribution,' he said.

Mervyn King also waded into the debate over Britain's ballooning national debt, urging the Treasury to rush forward plans to curb borrowing.

The Bank of England Governor said it had been right to loosen the government’s purse strings on a ‘temporary’ basis to boost the economy.

But in a direct challenge to Labour, Mr King said the Treasury now needs to put forward a roadmap to debt reductions starting next year.

'Five years from now national debt, as a proportion of national income, is expected to be more than double its level before the crisis,' the Governor said.

'So it is also necessary to produce a clear plan to show how prospective deficits will be reduced during the next Parliament, so returning to a gradually declining path for the ratio of national debt to national income.'

In a sign of mounting Government turmoil over the public finances, the Chancellor refused four times yesterday to endorse a pledge by the Health Secretary that the NHS budget would continue to rise after 2011.

Privately, some senior ministers despair at Mr Brown's determination to re-run the last three Labour election campaigns by focusing on Tory cuts.

Culture Secretary Ben Bradshaw admitted yesterday that the 'current projection' was for public spending to fall across the board in real terms.

Prime Minister Gordon Brown speaks during Prime Minister's Questions

Stormy session: Gordon Brown addresses Her Majesty's Loyal Opposition at Question Time

But in the Commons, Mr Brown repeatedly refused to accept claims that spending would fall under Labour plans already sketched out in the Budget.

He told MPs it was only the Conservatives who would implement cuts of ten per cent across many government departments.

He told MPs: 'Capital spending will grow until the year of the Olympics.

'The issue is that the Conservatives will be cutting expenditure in cash and real terms - Tory cuts, Labour investment.

'They are cutting expenditure so they can help the few with inheritance tax cuts, when we are the party of the many.'

The Tories said the Labour's own figures show capital spending - investment in new schools, hospitals, transport projects and other infrastructure - will halve from £44bn this year to £22bn in 2013.

And they said when interest on the national debt and spiralling welfare bills are taken into account, even day-to-day spending on public services will be cut by £12bn from 2011 under the Government's plans.

Downing Street insisted that proposals to sell £16bn-worth of assets would help plug the gap.

But Shadow Chancellor George Osborne said: 'Gordon Brown basically misled the House of Commons. This is Labour's big lie and the public will see right through it.'

At a stormy session of Prime Minister's Questions, Mr Cameron said that the Treasury's own figures showed that spending would fall in real terms under Labour, and accused Mr Brown of thinking the electorate were too "stupid" to notice it.

'If you can't be straight with people, you are simply not worthy to be our Prime Minister,' said the Conservative leader.

Mervyn King, governor of the Bank of England

Bank of England Governor, Mervyn King said the crisis in the City has ‘wreaked havoc’ on ordinary families

Mr Darling, speaking at the City of London’s Mansion House speech, appeared to rebuff Mr King’s calls for a ‘clear plan’ for reducing the government’s deficit.

The Chancellor said it would be ‘sheer madness’ to cut back public spending now, because it would ‘choke off the recovery and damage our public services’.

Mr Darling said: ‘Given the uncertainties which still lie ahead, I think it would be a mistake to try now to set in stone detailed spending plans for individual departments five years ahead.’

Mr King also struck a darker note on the outlook for the economy. While there are some signs that the recession is bottoming out, he warned that path to a full recovery could be ‘protracted’.

This is in part because Britain’s banks still do not have strong enough finances to return to normal levels of lending, the Governor said.

He also warned interest rates may need to rise as the economy moves into recovery mode. '

Mr King also had some harsh words for the City. He told assembled bankers there had been a drastic loss of trust in the financial sector.

The crisis in the City has ‘wreaked havoc’ on ordinary families, he said.

‘Unemployment, as we saw in today’s figures, is rising sharply. And yet it is the banking system that has received financial support on an almost unimaginable scale.’

Mr King also warned the Bank of England has insufficient powers to carry out a new legal duty to promote financial stability.

In remarks that are hugely embarrassing for the government, he said at the Mansion House: 'It is not entirely clear how the Bank will be able to discharge its new statutory responsibility if we can do no more than issue sermons or organise burials.'

That was a reference to the Bank of England's role as the administrator of the assets of banks that have collapsed.

'whatever is necessary'....that has an ominous ring to it, me thinks.

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Brown's in total denial.

He simply will not ever admit to cuts. He'd rather continue to the end, either getting chucked out by his own party or waiting to get chucked out in the election.

He will lie to the bitter end so he can try and pin the blame for the coming cuts firmly at the door of the Tories.

Unless the markets drive us to the IMF health spa first.

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Brown's in total denial.

He simply will not ever admit to cuts. He'd rather continue to the end, either getting chucked out by his own party or waiting to get chucked out in the election.

He will lie to the bitter end so he can try and pin the blame for the coming cuts firmly at the door of the Tories.

Unless the markets drive us to the IMF health spa first.

+1. Brown will continue to borrow and spend until the markets don't allow him to any more. I predict we go to the IMF sometime in the Autumn.

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8aspas_lg.jpg

Replace the water with:

79acdf46d3.jpg

and it'd be correct ;)

Gordon Brown is the devil anyway so it'll be a "normal" spa for him.

Edited by Kazuya

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Gawd must really be taking some very good tablets

I would hate to think what would happen if he went off the "mind meds". It might look a bit like this:

Gordon_Brown_Streaker.jpg

post-16847-1245281972_thumb.jpg

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