Brown defends his record, but US resists deal for world's poor

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The Independent Online

Gordon Brown launched a blistering attack on the International Monetary Fund yesterday, branding its criticism of the UK public finances as "wrong and out of date" as he prepared to put the economy at the heart of Labour's election campaign this week.

Gordon Brown launched a blistering attack on the International Monetary Fund yesterday, branding its criticism of the UK public finances as "wrong and out of date" as he prepared to put the economy at the heart of Labour's election campaign this week.

The Chancellor insisted the Government would pay for its massive investment in public services without breaking his "golden rule" to balance the books. He contrasted his plans with the Conservatives' proposals, which he dismissed as an "economic mess".

Mr Brown, who chairs a key IMF committee, was embarrassed last week when the fund's economists called for a £12bn rise in taxes to fill a hole in the public finances - a claim seized on by Opposition parties.

But in a press briefing alongside a visibly discomfited Rodrigo Rato, the head of the IMF, he said the report was written in December. "It is out of date, given the figures that I managed to put forward in the Budget [and] it has become more out of date as a result of what has happened on corporate tax and other revenues."

"I do not accept the IMF statement about the British financial figures. I may say - and I say this with respect to the staff at the IMF - they have been wrong about British growth ... and I believe the figures are wrong again from the IMF."

He added: "We will go ahead with our spending plans as I have set them down, because under our plans, we meet all of our fiscal rules."

Mr Brown also revealed Labour would publish its manifesto for business this week. His comments came as the IMF's international monetary and financial committee, which Mr Brown chairs, said rising oil prices and widening imbalances in the global economy had increased risks. Its communiqué, at the end of a week that saw the Dow Jones slump more than 400 points on fears of an oil-induced slowdown, called for action to boost investment in production, increase energy efficiency and improve oil market data.

Meanwhile Britain and its European allies look set to launch their own financial initiative to inject billions to relieve Third World poverty in the face of opposition from the United States.

Mr Brown admitted that the US still opposed his international finance facility, under which governments borrow $50bn a year on the capital markets against the promise of future aid budgets. "It's true to say the Americans have not been as enthusiastic about the IFF as other countries. The next meetings of G7 finance ministers will progress at least a European initiative on this matter," he said.

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