PwC agrees Chancellor may break Golden Rule

Link: Brown set to break Golden Rule

A PwC report just published concludes that the Brown could end up borrowing to fund current spending.

Since taking power in 1997, the Chancellor’s Golden Rule has been to borrow only to fund investment.

PwC said taxes might have to rise by at least £7bn to cut the budget deficit unless spending can be reduced after 2007.

The firm joins Ernst & Young in claiming that the Golden Rule could be broken.

And weaker than expected tax revenue figures in September also prompted speculation that Number 11 would need to borrow to cover the current cost of spending.

Brown has budgeted to borrow £33bn over the course of the current financial year.

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