The Governor of the Bank of England, Mervyn King, has called on the government to accelerate plans to reduce public borrowing, stating that current proposals lack sufficient ambition. Speaking before the Treasury Select Committee, King said the budget's deficit reduction timeline was not clear enough and that waiting for action was 'an awfully long time'.
Despite his criticism, King acknowledged that immediate cuts were not advisable and that the pace of any deficit reduction should depend on the strength of the economic recovery. He also sought to downplay any suggestion of a rift with Chancellor Alistair Darling, insisting the chancellor was not 'remotely relaxed' about the issue.
The comments come amid ongoing political tensions over the government's handling of public finances. Prime Minister Gordon Brown faced further scrutiny after refusing to correct or apologise for an inaccurate claim at Prime Minister's Questions that capital spending would rise until the 2012 Olympics.
King's remarks have reignited debate over the government's economic strategy, with some commentators warning of a potential IMF bailout if borrowing is not brought under control more swiftly. The pre-Budget report, expected this autumn, will be closely watched for any revised fiscal plans.
