Chancellor George Osborne today announced that he will deliver his first emergency budget on June 22nd, exactly six weeks after Britain's new coalition government took office.
Mr Osborne said that he would also be setting out next week details of the £6 billion of spending cuts to be made this year.
Speaking at the Treasury with new Liberal Democrat Treasury Chief Secretary David Laws alongside him, Mr Osborne warned that failure to tackle the UK’s record deficit would be “disastrous”.
Mr Osborne confirmed plans to hand over responsibility for setting the forecasts for economic growth and government borrowing - on which the budget calculations are based - to the newly created Office for Budget Responsibility under Sir Alan Budd.
“Again and again, the temptation to fiddle the figures, to nudge up a growth forecast here or reduce a borrowing number there, to make the numbers add up has proved too great, and that is a significant part of the reason for our current problems,” he said.
“I am the first Chancellor to remove the temptation to fiddle figures by giving up control of the economic and fiscal forecasts. I recognise that this will create a rod for my back down the line,” he said.
“That is the whole point. We need to fix the budget to fit the figures, not fix the figures to fit the budget.”
Mr Osborne said that tackling the deficit was the “most urgent issue” facing the Lib-Con coalition and warned that failure to get to grips with the problem could lead to the sort of problems now afflicting Greece.
“This is the legacy of thirteen years of fiscal irresponsibility. And it poses a very real threat to the recovery,” he said.
“Greece is a reminder of what happens when governments lack the willingness to act decisively and quickly, and when problems are swept under the carpet. “If we fail to tackle the deficit we inherited from the previous government, the consequences could be disastrous.”