EU attacks Darling deficit plan : not ambitious enough

Discussion in 'Wall St. News' started by ASusilovic, Mar 16, 2010.

  1. Alistair Darling and the Labour government have failed to announce a “sufficiently ambitious” plan to cut the budget deficit, the European Commission is poised to conclude on Wednesday, according to a draft document leaked on Monday.

    The Commission has no option but to rap Britain over the knuckles because Brussels recommended in December that the government increase the planned speed of deficit reduction. But the chancellor paid no attention to the advice in his pre-Budget report a week later.

    No consequences can flow from any findings by the Commission on the deficit because Britain is not a member of the single currency. But they will be embarrassing and give the Conservatives more ammunition in their argument that the deficit needs to be reduced faster.

    The draft statement concludes, “the fiscal strategy in the [UK] convergence programme is not sufficiently ambitious and needs to be significantly reinforced”, according to Reuters news agency. “A credible timeframe for restoring public finances to a sustainable position requires additional fiscal tightening measures.”

    In its December recommendations, the Commission, backed by European finance ministers, said Britain should reduce the deficit by 1.75 per cent of national income a year from 2011-12 to bring borrowing below 3 per cent of national income by 2014-15. Mr Darling’s pre-Budget report fell short with projected borrowing, on European definitions, of 4.6 per cent of national income in 2014-15.

    The Treasury will not be surprised by the findings nor is likely to act on them. It has studiously ignored recommendations from Brussels on the deficit since the middle of 2008.

    It stuck on Monday night to the government’s weaker aim of halving the deficit over four years. “The chancellor has taken a judgment on the appropriate pace of adjustment in 2010-11 and beyond,” it said.

    Both sides of the political debate tried to seize on different bits of the Commission’s findings to support their arguments.

    The Treasury added: “As the chancellor has made clear, to withdraw support earlier and at the wrong pace risks wrecking the recovery – a judgment supported by the Commission.’’

    George Osborne, shadow chancellor, said the findings were “a heavy blow for Gordon Brown’s credibility”.

    He added: “The Conservatives have been arguing that we need to reduce our record budget deficit more quickly in order to support the recovery.

    “Our argument is backed by credit rating agencies, business leaders, international investors and now the European Commission.”

    It is impossible to know how far apart the parties are in their plans for the deficit because the Tories refuse to say how much faster they would cut borrowing if they won power.

    After Greece, now UK in the crossfire ? :) :D :p
  2. Lethn


    Gordon Brown is such a dickweed, I saw him talking on the BBC yesterday to some supposed 'undecided' voters who were remarkably labour biased and it was amazing how patronizing he was to them when he was talking.

  3. +1
  4. Lethn


    I honestly couldn't think up a more appropriate insult lol
  5. I'm looking forward to a crash in the UK similar to Iceland.

    I left the UK last summer and may come back when the dust settles, but not before the next five years.

    I am hoping for a hung parliament or even a Brown victory just to accelerate the crash. That should be quite funny to watch.

    If there is a country in the West that crystalises the essence of a Ponzi scheme, it is the UK.

    But suckers are harder and harder to find....

    come on Emiratis, Chinese, come buy this beautiful mansion in Chelsea with 15 year leasehold remaining for only....GBP 1.1 million and 1500 sq feet. Yes, that's a bargain. Ok, after 15 years, you have nothing left, but in the meantime you paid GBP 1.1 million upfront for 15 years of living in beautiful Chelsea.

    Come on, there is only our land we can sell. We don't take sand as collateral so Emiraties from Dubai not welcome.
  6. Lethn


    I'm just hoping that the crash holds off long enough for me to make enough to leave the country that's pretty much all I ask, couldn't care less really what happens to this crappy country.
  7. I would love to see UK crash like nothing before, the shittiest country in the world, I wonder how much they bribed the fucking olympics committee hoping to get some international attention by holding the 2012 olympics in london
  8. zdreg


    It serves them right for trying to push Iceland around. what goes around around comes around. it is a basic law of nature.
  9. zdreg


    #10     Apr 15, 2010