Pre-Budget Statement: Tories attack 'complacent Peter Pan economics'

Opposition Reply

GORDON BROWN was yesterday accused of being "locked in denial" about his new growth forecasts by the shadow Chancellor Francis Maude, who claimed the forecasts were based on "Peter Pan economics" and "fairy- tale figures".

Attacking the Chancellor for being "arrogant and complacent", Mr Maude said that not one of the measures announced would save a job. "You won't take responsibility, not even a glimmer, that your own blunders are too blame. You had a chance today to give hope to people whose livelihoods are on the line but you blew it because you are too arrogant to admit you got it wrong."

He challenged Mr Brown over why Britain's growth next year would be less than half that of the next-weakest economy's and why Britain's forecasts had been cut by so much more than any other. He added: "You sit there grinning and smiling while all the constituents of your colleagues whose jobs and livelihoods are on the line will be disgusted by your complacency and your arrogance.

"Tell us, when it comes to the downturn, was Britain in first and in worst? There's a simple answer and it's sitting over there. Everything you are doing is making it worse."

Mr Maude said the director of the National Institute, on whom the Chancellor relied "so much", had forecast that borrowing would be five times his prediction.

"Don't you understand that the harder you press on the fiscal accelerator, the harder the Bank of England will press on the monetary brakes? Don't you even understand the effects of your own policies? In your own wonderland economy, you say it's okay to borrow as long as it's for investment, but you are not borrowing for investment or health and education."

Welcoming the Government's attempts to "try to match" the Tory record, Mr Maude went on to condemn Mr Brown for borrowing for social security payments. "You're moving the deckchairs around on the Titanic. Your own taxes and regulations have put a pounds 40bn hole below the waterline of British businesses; that's pounds 1,500 for every person employed... no more boom and bust, just the bust. No more stop-go, just the stop. Truly, this downturn was made in Downing Street."

Malcolm Bruce, the Liberal Democrats Treasury spokes- man, said the Chancellor's policies had led directly to an over-valued pound, which was higher than in the 1990 recession and real interest rates that were higher than the 1980 recession. "Has there not been a gap between diagnosis and cure? Is it therefore now clear that it is your own policy gap, rather than industry's own productivity gap, which explains the economic downturn we are now experiencing?"