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Budget 2005 - pre budget news and comments

Chancellor Gordon Brown's closest ally has denied suggestions there will be a Budget giveaway on 16 March.

During an interview with BBC Radio 4's Today programme, Ed Balls, ex-chief economic adviser to the Treasury, said there would be no spending spree before polling day and that he was confident the chancellor would meet his fiscal rules.

Mr Balls said he was sure Mr Brown's Budget would not put at risk the stability of the economy and would meet his golden economic rule - "with a margin to spare".

He said he hoped more would be done to build on current tax credit rules.

He also stressed rise in interest rates ahead of an expected May election would not affect the Labour Party's chances of winning.

Expectations of a rate rise have gathered pace after figures showed house prices are still rising. Consumer borrowing rose at a near-record pace in January.

Meanwhile, Sir Digby Jones, CBI director general, warned Mr Brown not to be tempted to use any extra cash on pre-election bribes and that stability was all important and any extra cash should be spent on improving workers' skills.

His message to the chancellor was: "Please don't give it away in any form of electioneering." and added "I don't think he will. I have to say he has been a prudent chancellor right the way through. Stability is the key word - British business needs boring stability more than anything”.

The Federation of Small Business has meanwhile called on Mr Brown to make the tax regime “fairer and simpler”.

Published: Thursday, 3 March 2005

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