LONDON Jan 19 British Finance Minister
Alistair Darling said on Tuesday there should be no doubt about
the government's commitment to reducing the country's record
Worries about the 178 billion pound deficit and the risk of
a downgrade to Britain's sovereign debt rating have sent
shivers through bond markets in recent weeks.
Darling's reluctance to set out immediate plans for
reducing public spending over the next four years has fuelled
concerns over the government's intentions.
But Darling told the Financial Times in an interview he had
been telling his ministerial colleagues for a year that the
deficit had to be reduced.
"I made the point on numerous occasions ... that getting
spending down, halving our borrowing in the four-year period
was non-negotiable: it was absolutely essential.
"That does mean that, in terms of public spending, there
will be cuts to some programmes; some programmes will be cut
themselves; there will be some postponements, and people should
be in no doubt about our commitment."
He said there was still too much uncertainty around to
conduct a spending review now.
The opposition Conservatives, favourites to win an election
due by June, want an early start to spending cuts.
But Darling said taking "significant sums of money out of
the economy at this stage is a risk to recovery."
He dismissed suggestions by the Conservatives that the Bank
of England would be able to protect the economy by offsetting
tighter fiscal policy with a looser monetary stance.
"Well, interest rates look about as low as they can get,"
he said, without elaborating.
The Bank of England slashed interest rates last year to a
record low of 0.5 percent and embarked on an unprecedented 200
billion pound asset buying programme to help drag Britain out
A full transcript of the Financial Times interview can be
seen at www.ft.com/darlingnews
(Reporting by Tim Castle; Editing by Diane Craft)