Brown gets lecture in economics from Poles
PM also faces spending watchdog inquiry over Whitehall efficiency savings
Wednesday 29 April 2009
Gordon Brown came under fire both at home and abroad yesterday over the state of Britain's finances.
On a visit to Poland, he had to listen to its Prime Minister pointedly criticise countries that tried to spend their way of recession.
And back in Britain Mr Brown was accused by Frank Field, a former Labour minister, of "irresponsible" mismanagement of the public finances after the Budget signalled record borrowing of £175bn this year. Mr Field warned that Britain was "sleepwalking into a mega-crisis". Amid scepticism over the Government's economic strategy, The Independent has learned that the National Audit Office, the public spending watchdog, is to investigate the drive to save tens of billions of pounds in Whitehall costs.
Meanwhile, Labour was facing a potentially embarrassing revolt over its new legislation for Gurkha veterans, after it emerged that dozens of its own backbenchers could vote against the Government in a Commons motion that will be triggered today by the Liberal Democrats.
Standing alongside Mr Brown at a press conference in Warsaw yesterday, the Polish Prime Minister Donald Tusk said his policy of "strict supervision" of the banking sector and a refusal to live on credit had proved the best way of averting economic disaster. Poland has managed to avoid the ravages of the credit crunch, enjoying 12 consecutive years of growth, while Britain's national debt is set to double by 2013.
Mr Tusk said: "The Polish government at a time of financial crisis behaved with full responsibility in terms of its public funds and the budget deficit. The method we have taken in respect to the crisis is not to multiply public expenditure but to be responsible with public funds."
Mr Tusk is not the first world leader to discomfort the Prime Minister over his stewardship of the economy. Last month, the Chilean leader Michelle Bachelet said savings built up during the years of plenty had eased the impact of the recession in her country.
George Osborne, the shadow Chancellor, said the Prime Minister had been given a "lecture on prudence" by the Polish premier. He added: "We are used to Polish builders telling us to fix the roof while the sun was shining, not the Polish Prime Minister as well."
Mr Field joined forces with Vince Cable, the Liberal Democrat Treasury spokesman, to deliver a withering critique of last week's Budget. They forecast that the Government could be forced into "slash and burn" cuts to reduce the mountain of public debt. The MPs said the Government had failed to set out a clear strategy for cutting the Budget deficit, protesting that it had delayed detailed plans on tax and spending until after the election expected next spring. In a Commons motion yesterday, they warned of, "the real danger the country faces in borrowing relatively more than any other G8 country to balance the national accounts".
They echoed warnings that ministers could be forced to axe major spending programmes beyond the efficiency savings already outlined in the Budget by Alistair Darling. The Chancellor demanded further savings of £15bn over the next two years when he announced his Budget last week, on top of a long-running efficiency drive which the Government claims has already saved £26bn. But economists have warned that the savings can be very hard to achieve and measure.
Edward Leigh, the Tory chairman of the Commons Public Accounts Committee, has asked the National Audit Office to investigate cost-cutting.
The Independent disclosed yesterday that Cabinet ministers are privately questioning the future of the identity card scheme, while many Labour MPs believe the planned £25bn replacement to Trident should be axed. David Blunkett, the former home secretary, yesterday suggested the Government should scrap plans to introduce ID cards for British nationals and issue universal biometric passports instead.
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