Election 'last thing on my mind' says Brown

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Indy Politics

Gordon Brown said today that it was too early to judge the success of his £37 billion bank bail-out - and insisted he had "no plans" to call a General Election this year.

The Government is preparing a fresh bid to push the banks into resuming lending amid figures showing mortgage lending slumping to a new low.

Mr Brown played down suggestions that it could include another injection of public cash into financial institutions and urged voters to judge his policies by long-term effects.

Speaking on BBC One's Andrew Marr Show, he also accused the Conservatives of "almost revelling in things going wrong" with the economy.

Asked if the bail-out had failed, he said: "I do not think you can judge the success of recapitalisation by what happened in one month; you have got to judge it as a necessary means by which, by saving the banks - and saving is the right word - we restore the ability to fund businesses and mortgages.

"If we had not acted that weekend and then the rest of the world acted, you would have had a banking collapse, you would have lost major institutions."

He went on: "From January 1 we have the small business scheme, we have the export credit scheme, we've got the ability of companies to defer their payments to the Inland Revenue.

"We've got other means by which we will try to get liquidity, cash into the system."

Asked if that could include more public cash for the banks, he said: "I do not think that's the first thing anyone would think about at the moment.

"The first thing we are thinking about is how we can help the flow of money to businesses; how we can get the banks doing what they said they would do after the recapitalisation - that is, maintaining the level of funding for small businesses and mortgages that happened in 2007."

The Prime Minister, who said today that up to 100,000 jobs could be created through Government projects being brought forward, also pointed out that only a small fraction of an £18 billion boost for the economy had yet been spent.

"If we have spent £1 billion of a total of £18 billion to be spent, some on public works, some on keeping people in their jobs, some on environmental and green projects, some on helping more people go to university and college... we have just started.

"You can't judge a success or a failure by the first few weeks, you've got to judge it over the next few months."

Asked to rule out a 2009 General Election, the PM said it was "the last thing on my mind" - adding, when pressed: "I've got no plans for that."

In a swipe at Conservative rival David Cameron, he said: "Those people who are saying 'don't use fiscal policy; don't be active; just let the recession take its course' - the Conservative view - which I think is wrong because it is, in a sense, almost revelling in things going wrong.

"Things are going to go right because we take the action that's necessary."

The Prime Minister will put the focus on jobs this week during a three-day tour of the country, ending with a meeting of his Cabinet in Liverpool on Thursday.

There will also be a summit at Downing Street next Monday in a bid to find ways to protect jobs amid predictions that the unemployment rate could top three million this year.

Mr Brown believes that moves to bring forward £10 billion of public projects - such as school repairs, transport improvements and the creation of a high-speed broadband network - will create or secure up to 100,000 jobs.

"I want to show how we will be able to, through public investments and public works, create probably 100,000 additional jobs over the next period of time in our capital investment programme - schools, hospitals, environmental work and infrastructure, transport," he told The Observer.

Initiatives likely to be discussed at next week's summit include giving state support to firms to support extra training for workers forced to switch to part-time employment.

"There's some companies that may be working people three or four days a week and using the next day for training perhaps, we are looking at a whole range of things we can do," he told the newspaper.

"If a company comes with a proposal (that could involve) training for the workforce for a future I think we are in a position to do more to help. Our responsibility is not to walk by on the other side."

Liberal Democrat economics spokesman Vince Cable said the number of new jobs would be "overwhelmed" by the number being lost - and questioned whether they could be sustained beyond this year.

"The proposals which the Prime Minister is advocating in terms of environmentally-friendly public investment are very similar to those the Liberal Democrats were advancing before Christmas.

"This represents a much more effective stimulus to the economy than the temporary cut in VAT.

"However, we need to know more details about how this programme will be financed and what Gordon Brown means by bringing investment forward.

"This must not mean that investment should be cut next year if the economy is still in serious difficulty.

"Although sensible public investment is welcome, the jobs created will be overwhelmed by the job losses which most business organisations now expect."

The Government was "confused and paralysed" in its approach to the banks, he said.

"The Government continues to be confused and paralysed in terms of the contradictory signals it's giving to the banks which are continuing to withhold credit from sound companies as they repay government loans," he said.

"The Government must give priority to sorting out this confusion which it has created itself."