Polish leader offers UK alternative crisis cure

WARSAW (Reuters) - Polish Prime Minister Donald Tusk told his Prime MinisterGordon Brown on Tuesday that keeping a tight rein on public spending was the way out of the financial crisis, a stark contrast with UK policies.

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“I want to emphasise that banking sector supervision, abiding by the rules and not living excessively on credit are the surest ways of avoiding crisis,” Tusk said, standing side by side with Brown after talks in Warsaw.

A British reporter had asked Tusk how the Polish economy had managed to avoid contracting and whether there were any lessons for recession-hit Britain.

Poland and the EU’s other ex-communist members have had to keep a lid on spending in the economic crisis because of trouble getting access to the borrowed cash that has let Britain and other developed nations try to spend their way out of recession.

Tusk’s recommendations come after Brown’s government announced last week that Britain’s budget deficit would soar to a record 175 billion pounds this year -- 12 percent of GDP -- as the economy shrinks at its fastest pace since World War Two.

The budget has unleashed a torrent of criticism of Brown’s handling of the economy during 10 years as chancellor and two years as prime minister.

The Conservatives, who say Brown failed to get public spending under control in good economic times, enjoy a big opinion poll lead over Brown’s Labour Party with the next election no more than 14 months away.

If Brown hoped to escape the criticism while on an overseas trip which has taken him to Afghanistan and Pakistan as well as Poland, he was mistaken.

“I should not be speaking as a reviewer of an economic policy of any country. All I can say is that the Polish government, at a time of financial crisis, behaved with full responsibility in terms of public funds and the level of budgetary deficit,” said Tusk, a centre-right leader whose Civic Platform party is well ahead in the opinion polls.

“The assumption that we adopted as the method to fight against the financial crisis is not to multiply expenditures but rather to increase responsibility for public funds,” he said.

Poland’s economy grew 4.9 percent in 2008, but is now slowing sharply.

It is the second time in recent weeks that another country’s leader has inadvertently undermined Brown during an overseas visit. Brown suffered a similar experience during a trip to Chile in March.

Reporting by Adrian Croft; editing by Keith Weir