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TIME TO CALL IN THE AUDITORS TO GET A BELIEVABLE GROWTH FORECAST - TAYLOR

1.11.22pm BST (GMT +0100) Thu 15th May 2003

Matthew Taylor MP, Liberal Democrat Shadow Chancellor of the Exchequer

Matthew Taylor MP, Liberal Democrat Shadow Chancellor, responding to the Bank of England Inflation Report released this morning, said: "The Bank of England has rejected Gordon Brown's optimistic growth projections, and have refused to back them."

"It is time to call in the auditors so that we have a believable forecast not wishful thinking." ENDS Notes to editors "

"1. The Bank of England's Inflation Report released today"

"predicted around 2.5% GDP growth for next year, compared to a HM Treasury projection of 3-3.5%. Deputy Governor Mervyn King when asked for a reason for the divergence between HM Treasury and Bank of England projections replied that the reporter 'should put the question to them'. "

"2. In response to other questions the Bank revealed that HM Treasury had a higher assumption about trend growth rates than the Bank of England, leading to 'more buoyant' assumptions on consumption growth. He also revealed that this was due to lower predictions by the Bank of England of the trend growth in productivity per hour, population growth, hours and the natural rate of unemployment."

"3. Mervyn King also noted that the ratio of debt to household incomes was 'at an all time high'.

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