EU calls for action on UK deficit (From Crewe Guardian)

EU calls for action on UK deficit

8:41pm Monday 15th March 2010 in

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Britain will be told by the European Commission this week to up its game on getting the economy back in shape.

An EU report, which will not be welcomed by the Treasury, says efforts to get the UK budget deficit down to limits set by Brussels for single currency countries may not be good enough to meet an EU ultimatum for complying with the rules.

As a non-eurozone nation, the UK cannot be sanctioned for breaching single currency deficit and debt guidelines.

But in an economic health report on the UK due out on Wednesday, the Commission makes clear the Government is expected to comply with an EU deadline of 2014-15 for getting the deficit below the maximum 3% of GDP allowed under economic stability rules.

Brussels says the Treasury's strategy for doing so is not ambitious enough and is calling for tougher measures.

A senior EU official commented: "The message from the Commission will be that the UK needs to get its house in order".

The report will be published once it has been endorsed by a meeting of the Commissioners on Wednesday. They are expected to nod through a draft document which calls for extra "fiscal tightening" by Chancellor Alastair Darling if a "credible" timetable for restoring sustainable public finances is to be met.

A Treasury spokesman said that the Government has set out a plan to halve the deficit in four years - the sharpest deficit reduction plan in the G7, backed by legislation.