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PM refuses to rule out tax rises to rescue the economy
Nicholas Cecil, Chief Political Correspondent11 Nov 2008
GORDON BROWN today refused to rule out future tax increases to pay for the giant economic rescue package that is expected to be launched next week.
The Prime Minister admitted he could not be sure his multi-billion stimulus would succeed and that it would be several years before the costs and
benefits could be calculated.
A combination of tax cuts and higher spending to boost the flagging economy is set to be at the heart of the pre-Budget report, which sources say may be announced next Wednesday.
Before that, Mr Brown will fly to the United States this Thursday for a global summit where he will encourage other countries to carry out similar action in a concerted effort to stave off a world slump.
But asked to deny that the British measures — which reports say could add up to £15 billion or more of borrowed money — would have to be repaid in future tax rises, he told his monthly press conference it was too soon to say. “We are in a period of huge uncertainty,” he said. “Nobody quite knows whether the international action we are proposing will yield the results that we want to see.
“I think it is too early to judge conclusions about two years ahead, three years ahead, or four years ahead. What I do know is that the right time is to take action now, with the fiscal stimulus to the economy.”
Mr Brown openly acknowledged that the British package would be unfunded, marking a change from his past strictures against spending money without either matching savings or tax revenues. “You have to take action that is initially unfunded,” he said. “That is the idea of a fiscal stimulus.”
Mr Brown was boosted today by a poll showing that his handling of the economic crisis was warmly approved of by voters. Labour has bounced to within six points of the Conservatives and more than half, 52 per cent, see Mr Brown as the best leader to run the economy, compared with 32 per cent for David Cameron.
But Labour is still facing defeat at the next election, found Populus in The Times. It is up five to 35 per cent, with the Conservatives down four to 41 per cent and the Liberal Democrats nudging up one to 16 per cent.
Mr Cameron, the Conservative leader, criticised the Prime Minister's economic rescue, saying it was “a mistake” to believe governments could “borrow without limit” and spend their way out of a recession. He forecast higher taxes in the future to pay for the splurge.
The Tories seized on remarks by Minister for London Tony McNulty today in which he appeared to admit that taxes would have to rise over the long-term to fund extra borrowing. When asked on BBC2's Daily Politics whether taxes would go up, he replied: “Over the longer term, that is the point.”
The Prime Minister said it was vital the US summit resulted in all the major economies taking concerted action. Economists have warned that the benefits would be partly wiped out by a surge of imports if Britain acted alone.He also urged a new deal on free trade — putting himself at odds with Barack Obama who has promised to curb imports to America to protect jobs.
Mr Brown said the “beggar thy neighbour” approach of protectionism would delay global recovery.
Reader views (39)
Brown is a proven liar (what happened to the promised vote on the corrupt Europe), he is incompetent and is devious. He was useless as a Chancellor and is worse as a PM. The Tories should be ripping him to shreds but 'call me Dave' hasn't got the punch. However, the Tories are our best alternative as the Lib Dems live in fairey land. THe Tories will win the next election and to coin a Labour phrase "It can only get better"
- Trevn, Abu Dhabi, 12/11/2008 08:17
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Look at the history of tax rates in the US. Just prior to the recession they were raised and raised and raised and only WW2 brought us out of the death spiral.
How about CUTTING GVT ? Cutting the dole? Sending home illegals who are sucking the coffers dry?
- Trunk, US, 12/11/2008 01:38
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I think Gordon and Tony have done a fantastic job over the last 11 years and I can't wait to give them the rest of my money and my vote.
- Jimbob, HMP Broadmoor, 12/11/2008 00:04
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Quite frankly I can't stand that super-toff, "30 million quid" David Cameron and his hideous sidekick chancellor. Now that the Labour Party are a little less accident-prone and toxic I hope my vote will help keep the Tories out of office.
- Francis P, Coventry, 11/11/2008 22:13
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Gordon Brown is completely off his chump.
- Albert Hall, hove england, 11/11/2008 21:14
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Tony, London,
To answer your question ... voting Tory is the most likely way of getting rid of Gordon Brown and New Labour. You may think that is a bad choice (up to you), but of all the sorry set of Politicos on offer, David Cameron has the best chance of kicking out Gordon Brown, who (incidentally) has robbed me blind for the past 11 years.
But it is all my own fault, I worked, I saved. I did not get into debt, but Gordon wants my savings to give to the weaklings that support him.
- Anglo, Sussex UK, 11/11/2008 17:28
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What has put a smile on his face and the simulacrum of a bounce in his step is the certainty that he will never again have any difficulty in raising taxes, not in his life-time. No more need to resort to stealth taxes. The country and the opposition will be begging for tax rises to cut the stratospheric deficit he is constructing. In the meantime, Gordon has guaranteed that Government will be at the centre of everybody's life for decades to come. Good-bye dream of light-touch government and a centripetal economy buoyed by private initiative. It must feel to him like Christmas has come early this year.
- Blackstone Coke, London, 11/11/2008 17:02
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First Brown admits to future tax hikes then McNulty on the Andrew Neil show... Now will the electorate see what Labour is about?
They are the spend today and pay heavily tomorrow party! It's called BOOM & BUST stupid!
- R King, Hants, 11/11/2008 16:36
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For 11 years he refused to wear formal dress to these functions. He made a point of showing that he would not bow to such conventions. Why has he suddenly decided to change his principles? They are gone, like his moral compass, Prudence, and any vestige of integrity he had before he brought Mandelson into his government. Sorry, Gordon, you can wrap yourself in whatever you wish, but you cannot change what you have done to this country.
- Beatriz, London, 11/11/2008 16:29
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So Brown will bump up taxes for middle class and give tax cuts to who? Or will he cut taxes and increase them at the same time. He is taking as brain dead just as Blair and we foolishly voted for the,
He increased my NI contribution by 1% to pay for NHS. My GP's salary is doubled and his working hours remain the same. The Great Ormond Street Hopsital is begging £3 per month through TV adverts, my local hospital has rationed its services much further, Where all that money gone? Brown has the temerity to say what he says having presided over the financial meltdown by stoking up credit boom and creating feel good factor for election wins. He is at his old game again.
- Simon, London, 11/11/2008 15:44
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Tax cuts for the scroungers to see him safely through an election, followed by tax rises funded by those of us lucky enough to still have a job.
- Nobby Clark, Perth, Scotland, 11/11/2008 15:33
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Brown - What better to use than the same fox dug his hole to find find it.
This man has single handedly destroyed everything that used to make me proud of being British .
He makes me want to puke and anyone else that is niave enough to vote for him.
- Tom, Newport, 11/11/2008 14:34
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People, rightly or wrongly, criticize the Labour Government but can they explain to me why as an employed, married, no children, houseowner I should be bothered to vote Tory. Their big announcement today does not effect me in any way. Gordon Brown is, at least, making announcements (however bogus and duplicitous).
- Tony, London, 11/11/2008 14:22
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Yes let's see what bribes Brown is going to give us so that his popularity increases even more in the run up to the election.
Then you will see the ignorant people,and those with short memories, supporting Brown.
I hope Cameron has some aces to lay down when the time is right,so that we can put Labour back on the streets where they belong.
- P.Robinson, Northants, 11/11/2008 14:16
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Gordon will get my vote next year as he a good PM.
- Andy, london, 11/11/2008 14:07
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Oh please just stop all the knee-jerk anti-Brown stuff. Issues like the economy are far complicated than you make out. Whatever you think of his politics, demeanour and management skills, he has been Chancellor for over 10 years. He is very experienced, which is how he came up with a global solution to the recent banking crisis that everyone else in the world realised made sense. So just stop griping and accept that fact.
- Jeremy, London UK, 11/11/2008 14:05
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Brown should dampen down any talk of election speculation and come out and say there will be no election between now and mid-2009, then anything is possible. H'es got a job to do and he's getting on with it.
- Dhanraj, Basildon Essex, 11/11/2008 13:57
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Anyone believing these polls should be classed as a fool. Labour got us in this mess, spending our pensions selling our glod at cut price and now they are being hailed as heros, my goodness! If Labour get in again we might as well pack up shop and leave Britan as we are being sold down the river.
- Maggie May, London, 11/11/2008 13:48
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Regarding FLy's comment - where are you thinking of going if Labour are re-elected, and will you respect the judgements of the voters in that country? You may not like or agree with other people but we have a system of government that is democratic (not perfect of course) and saying you will leave the country if you don't like the outcome seems a bit childish.
- Graeme, Tyne and Wear, 11/11/2008 13:45
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I would like to know who the pollsters talk to. It certainly isn't me. I suppose they talk amongst themselves the same way the TV channels have rigged votes on various programmes. If they had asked me I would say GB and his idiot friends were the ones responsible, for raping and pillaging the pension funds, taxing us to death whether direct or indirctly and making sure the cupboard was bare when we needed reserves most. It would seem this country loves failure particularly when it is in politicians!!! This party is parasitic in taking away our freedoms and interferring with our lives when it is not necessary. They have created internal conflicts in Great Britain whether via devolution of "racial equality" etc without allowing us the right to speak and discuss things which are so important to most of the British populace.
- Dave From Sussex, Worthing, Sussex, 11/11/2008 13:27
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we've truly got the government we deserve!!
- Albert Hall, kettering, 11/11/2008 13:21
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Lets go to the polls if Brown is gaining popularity, this will not happen as Brown knows he is toast come voting day. Lets not forget Labour created this, alongh with everything else they messed with.
- Brandon Thomas, London UK, 11/11/2008 13:10
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I cant take these polls seriously. How can people suddenly find Gordon Brown and the increasingly inept Labour Party to be the heroes of the hour. They are part of the reason we will be the worst performer of the major economies. Plus we didnt vote for him anyway! roll on 2010
- Mike, London, UK, 11/11/2008 13:04
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Brace yourselves for a whole raft of brown bribes in the run-up to the next election to keep the morons happy.
- Albert Swift, Aberdeen, Scotland, 11/11/2008 13:01
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I think that Brian from Wiltshire needs to take a look at the Tory website because it is here that George Osborne sets out EXACTLY what the Tories would do if they were in power to combat the credit crunch - and it makes sense. You don't have to be a rocket scientist do see that Gordon Browns way is the route to even more disaster.
- Mark Burton, St Ives Cambs, 11/11/2008 12:56
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This is more a comment on the pathetic George Osborne, rather than any confidence in Labour's economic policy. If Cameron had any guts or real vision he'd fire Osborne, get Vince Cable to jump ship and put together a viable economiuc plan to get us out of theis situation.
- John Culpepper, London UK, 11/11/2008 12:38
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Brown created the mess and he is putting us all, including our grandchildren into debt for many years to come. He is a pension pincher and has been responsible for many billions of pounds being wasted each year. Hell will have to freeze over before Labour ever get my vote again. The Tories have missed opportunity after opportunity to get voted in because of weak leadership and lack of policy's, its about time they they stepped up to the mark, and quickly.
- Roger, Staines, 11/11/2008 12:25
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I am not sure why everyone is hailing Mr Brown on this matter. As far as I can make out, he was instrumental in setting the scene for us getting into this mess. His policies for getting us out will hold us hostage for many years to come as it turns out that the huge sums he is borrowing on the tax payers behalf are mainly coming from countries whose cultures and philosophy are inimicable to us. And still the very rich residing in this country often pay tiny or no taxes.
- Helen, norwich, 11/11/2008 12:12
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I am not sure why everyone is hailing Mr Brown on this matter. As far as I can make out, he was instrumental in setting the scene for us getting into this mess. His policies for getting us out will hold us hostage for many years to come as it turns out that the huge sums he is borrowing on the tax payers behalf are mainly coming from countries whose cultures and philosophy are inimicable to us. And still the very rich residing in this country often pay tiny or no taxes.
- Helen, norwich, 11/11/2008 12:11
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No doubt next week, Gordon will be telling everyone how to turn our water into wine, feed a family of 5000 with a couple of loaves of bread and a couple of fishes and heal the sick. And there are still some idiots who can't see through all of his twaddle. It was his policies that put us in this mess, why should anyone with half an ounce of common sense believe that his "promises" will get us out again.
Maybe someone should ask him if he knows how much the price of a loaf of bread has risen in our local supermarket in the past 6 months - 25%, but he wouldn't know that because sadly, he doesn't live in the real world where people are struggling to pay their bills and feed their families.
- David, London, 11/11/2008 11:56
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I find that quite worrying. Can people really be so naive? Whatdo they base their judgment on? That he seems to be there every day on the telly and therfore a reliable sort? For God's sake that ignoramus got everybody in trouble in the first place. And now he wants to borrow even more - Britain will end up like Iceland under that government!
- Delphine, Oxford, 11/11/2008 11:36
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We truly are living through 'historic' times.
This must be the first time that a 'dead dog' has bounced!
Especially one that's already been dead for 12 months, after being brain dead for 12 years.
- Dave, cumbria, 11/11/2008 11:19
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its simple- higher tax leads to higher poverty and failure in the working population, only labour would invent a policy that takes peoples money away from them, then they make people apply to get it back (at huge cost) and they call it a "credit"
- John G, London UK, 11/11/2008 11:06
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Thank God common sense is prevailing , Mr Brown and the labour party are the only party brave enough to do what needs to be done during this reccesion, I dread to think what the tories would do , probably very little and watch as businesses and families go to the wall, i think they call it market forces.
I am not Labours biggest fan but only they seem able to sort this mess, after that , then yes lets put Cameron in power, when times are good they are the best.
- Brian, Wiltshire, 11/11/2008 10:56
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No doubt some people hope Brown has made it all go away with an interest rate reduction and promised minor tax cuts.
There does seem to be a continuing naivety about the ability of government to offer instant and effective remedies for economic problems which have taken a very long time to reach poisonous flower.
If it does not all go away things will look different.
- Mike Newland, London, England, 11/11/2008 10:42
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it shows just how short sighted people in this country really are. Its time to pack up and leave if this lot get voted in again.
- Fly, london, 11/11/2008 10:38
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Just goes to show you can fool some of the people all the time. Who do the idiots who think that Brown can get us out of the mire thinks got us in it in the first place by spending everything (including a massive chunk of our pensions) in the good times?
- Paul, London, 11/11/2008 10:35
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Just goes to show how ignorant and stupid many of the x factor watching, heat magazine reading, general public are
- Lb, London, 11/11/2008 10:30
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are people really this stupid? this idiot got us into this mess in the first place and now he's being praised for it????
- Showard, london, 11/11/2008 10:18
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