Election winner will pay the price, says Bank chief

Bank of England governor Mervyn King has warned privately that the winner of the General Election could pay the price the next time the country goes to the polls, it was claimed today.

US economist David Hale said Mr King had confided that whoever takes power after May 6 will have to implement such severe measures to rebuild the public finances, they will find themselves out of office for a generation.

"I saw the governor of the Bank of England last week when I was in London and he told me whoever wins this election will be out of power for a whole generation because of how tough the fiscal austerity will have to be," he told Australian television.

The Bank would not comment on his remarks, although it is understood that the two men met in early March and not last week as Mr Hale said in the interview.

The governor's private warning emerged after the Institute for Fiscal Studies accused all the main parties of failing to come clean over the depth of the spending cuts needed after the election.

It said that Labour or Liberal Democrat proposals would see the country facing cuts on a scale not seen since then chancellor Denis Healey called in the IMF in the 1970s.

Under the Conservatives' economic plans, it said the cuts would be the most severe since the Second World War.