Brown's forecasts 'too optimistic', say MPs

Gordon Brown could be forced to slash his "optimistic" growth forecasts, a powerful cross-party committee of MPs warned yesterday. The Treasury Select Committee said the risks to the Chancellor's forecasts for the economy and public spending in November's pre-Budget report were on the "downside".

It also criticised the way the Treasury put the document together and called for more independent scrutiny of the assumptions it used. "We note that the forecasts for 2004 and 2005 could turn out to be optimistic," said the report published by the committee, which has a Labour majority.

"While there are upside and downside risks ... we believe that the overall balance of risks to the Treasury's GDP forecasts is the downside."

The Treasury believes the economy will grow by about 3 per cent in both 2004 and 2005.