Brown may be forced to ‘fiddle’ the books

Link: Government spending moves out of the red

The National Institute of Economics and Social Research said the chancellor was facing a £20bn shortfall in the public finances.

To get round this, Brown must use an accounting fiddle or a tax rise in order not to break his ‘golden rule’ that the government’s books are in balance or in surplus at the end of an economic cycle, the NIESR said.

A £20bn deficit is the equivalent to an almost 6p rise on the basic rate ofincome tax, said the NIESR.

One way round a tax rise could be to shift any debt off the balance sheet.

Ray Barrell, a senior research fellow at the institute, said: ‘Anintelligent civil servant could find a way to massage the figures to shiftdebt off the balance sheet.’

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