Newspaper article The Evening Standard (London, England)

Brown's Anger at Tax Rise Warning from Aide to Hewitt

Newspaper article The Evening Standard (London, England)

Brown's Anger at Tax Rise Warning from Aide to Hewitt

Article excerpt

Byline: JOE MURPHY

GORDON BROWN was infuriated today after a senior economist hired by Trade and Industry Secretary Patricia Hewitt said taxes would have to go up again to pay for his spending plans.

Vicky Pryce also angered ministers by describing the Chancellor's five tests on whether to join the euro as no more than "an informed guess".

Her outburst comes less than a fortnight before the Chancellor delivers his spending review - and two days after he used his keynote Mansion House speech to bolster the credibility of the five tests.

Ms Pryce spoke out in a briefing at the Foreign Press Association where she admitted that some public services, especially transport, were becoming black holes which needed "loads more money" from the Exchequer. "To be re-elected again the Government knows it has to spend a lot on public services.

Transport in particular is becoming a black hole."

Speaking remarkably frankly she implied that Mr Brown's Budget plans might not be robust enough to cope with a global recession.

"We are in a bit of a dilemma about where we go from here, particularly due to a slowdown of the world economy," she said.

Ms Pryce, one of the City's most respected economists, was recently appointed chief economic adviser at the DTI and will take up the post in August.

The Chancellor's fury at her outburst was swiftly made clear by Treasury sources. One raged today: "We thought it was a spoof. We were asking each other, who is this person?

The Treasury is responsible for the single currency and tax policy and this person has no insight into Treasury thinking whatsoever."

An official spokesman for the Treasury said: "These views do not represent and are clearly contrary to Government policy."

Downing Street also disownedthe warnings - and poured cold water on Ms Pryce's status and competence. …

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