Out of their depth: Bank Governor's private view of Cameron and Osborne

Latest leaked diplomatic files reveal Meryvn King's comments ahead of election
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David Cameron and George Osborne were described as lacking "experience" and "depth" by Meryvn King, the Governor of the Bank of England, according to the latest leaks of American diplomatic cables.

Although the Governor's verdict was given before the May general election, his remarks will be seen as an embarrassment to the Prime Minister and Chancellor. Mr King's views were relayed to Hillary Clinton, the US Secretary of State, after he expressed them to Louis Susman, the US Ambassador in London, according to the Wikileaks website.

Mr King, who is expected to remain politically neutral, told the Ambassador in February he had held private meetings with the Tories' two most senior figures to urge them to draw up a detailed plan to reduce the public deficit.

The Governor criticised their "lack of experience" and the lack of depth in their inner circle, according to the leaked cables. He said the two men operated too much within a narrow circle and "had a tendency to think about issues only in terms of politics, and how they might affect Tory electorability".



His apparent pressure on the Tories will fuel speculation that Mr King played a key role in persuading the Coalition to support a more dramatic deficit-reduction strategy than any party supported at the election.

Cables published today also reveal that internal Tory polling found Mr Osborne lacked the necessary gravitas in the public's eyes and was seen as a "lightweight and inexperienced, in part due to his high-pitched vocal delivery". As a result, it was Mr Cameron who made an emergency statement on the financial crisis to the Tory conference in the autumn of 2008.

They show that Mr King believes Europe's sovereign debt crisis will speed up political union. "Leaders in Germany and France have recognised that allowing monetary union to happen without corresponding political cohesion was a mistake and one that needed to be rectified," the Governor told American diplomats.

According to the cables, Liam Fox, the Defence Secretary, told the US that the Tories would be tougher on Pakistan because they were less reliant on votes from the Pakistani community than Labour. Referring to Muslim extremists in Britain from Pakistan, Mr Cameron told the Americans in April 2009 that under Labour "we let in a lot of crazies and did not wake up early enough".

Downing Street is said to be relaxed about the disclosures. Officials were warned by Mr Susman last week that they were among the 250,000 US cables leaked to the whistle-blowing website.

Number 10 is likely to play down the Governor's criticism of Mr Cameron and Mr Osborne as out of date. Mr King has praised the Coalition Government for taking decisive action to cut the public deficit as soon as it came to power by announcing £6bn of spending cuts.

Mr Susman admitted last night that the leaks were embarrassing but insisted that gathering information about politicians was central to his role as US Ambassador. "It is the duty of a diplomat to report those conversations so people can take that into account, so they know what's going on," he told the BBC. "Gossip is not gossip if it's conversations that are had. Gossip is speculation, and there is no speculation."

A Bank spokeswoman said last night: "The Governor has a very effective working relationship with the Prime Minister and the Chancellor."



American diplomats in London told Washington that the Liberal Democrats would not enter a Coalition with the Conservatives if the May election resulted in a hung parliament.

"Most Lib Dems are instinctively hostile to the Conservatives and would not agree to join a Tory-led governing Coalition," one leaked US cable said. However, propping up an "exhausted" Labour Party led by Gordon Brown was seen by most Liberal Democrats as "political suicide" because it would undercut their appeal as a party of political change. A formal Coalition with Labour under a new, non-Brown leadership was not ruled out.

PLS KEEP Two top Liberal Democrat strategists, Polly Mackenzie and Chris Saunders, who now both work in government, planned to run a fierce anti-Cameron election campaign, describing him as "out of touch with real life". The death of his son Ivan forced them to drop the idea since it "eliminated these vulnerabilities".

What the files say

The following extracts are from a classified memo from US Ambassador to London, Louis B Susman, dated 17 February this year. In it he details concerns from the Governor of the Bank of England about the UK's recovery from recession:

* Mervyn King expressed great concern about Conservative leaders' lack of experience and opined that Party leader david cameron and Shadow Chancellorsborne have not fully grasped the pressuresthey will face from different groups when attempting to cut spending.

* Businesses will cut jobs faster this year and eliminate many part-time positions, as employers realise that economic recovery will be a long, drawn-out process.

* David Cameron and george Osborne do not fully grasp the pressures they will face when attempting to cut back on spending, when "hundreds of government officials will make please of why their budgets should not be reduced."

* Cameron and Osborne have only a few advisors, and seemed resistant to reaching out beyong their small inner circle.

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