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BROWN SHRUGS OFF LOW GROWTH FORECAST AND SAYS PUBLIC SPENDING PLANS ARE SAFE

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Chancellor Gordon Brown is playing down reports that a predicted slowdown in economic growth could curtail his publ...
Chancellor Gordon Brown is playing down reports that a predicted slowdown in economic growth could curtail his public spending plans, reports the Financial Times (p1).

The Liberal Democrats claims a reduction in the growth forecast to 1 per cent from the 1.75 to 2.25 per cent announced in the budget in March would erase the£36bn budget surplus predicted for the next four years.

But speaking from Washington, Mr Brown said his spending plans were 'safe' and could be met without raising taxes.

Mr Brown was also accused of bullying the Bank of England to cut interest rates, a move which meant a cut was now less likely according to Malcolm Bruce, Lib Dem treasury spokesman.

Francis Maude, the shadow chancellor, said Mr Brown had given the Bank 'an incredibly difficult dilema' and claimed the downgrade put 'a large black hole' of more than£15bn in the government's 'reckless' spending plans.

Meanwhile, education secretary David Blunkett has been assured by Mr Brown that£19bn earmarked for education over the next three years is still secure, reports the Guardian (p8).

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