Gordon Brown in interest rate cut talks on 100 Mortgages

Gordon Brown is expected to defend his plans to increase government borrowing in order to tackle the economic downturn in a speech later.

Prime Minister Gordon Brown is set today to tell business leaders they need to heighten the demand for government spending in a bid to challenge the economic crisis. Economists and opposition parties have attacked the government saying that the UK is not prepares for recession and that they need to make appropriate tax cuts.

The UK’s quarterly public debt figure stands at £37.6 billion when last recorded which is higher than the whole of the previous year. Gordon Browns wants to use the fiscal policy to kick start the economy and said this is the correct strategy to increase borrowing although many economists disagree.

Brown is expected to say in his speech that they have already targeted through the tax system things like freeze on fuel duty, the increase in the stamp duty threshold temporary and the £120 tax rebate for basic-taxpayers. Mr Brown also hinted that we could see another interest rate cut.

Mr Brown told the BBC “Now inflation is actually coming down over the next few months and that will mean that it gives scope to all the monetary authorities, including the Bank of England, round the world to make a decision about interest rates”.

Source: BBC

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