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Government Deficits

Volume 518: debated on Tuesday 16 November 2010

17. What recent discussions he has had with his international counterparts on the co-ordination of efforts to reduce Government deficits. (23980)

The UK has been actively engaged in G20 discussions. The Prime Minister and the Chancellor attended the G20 summit on 11 and 12 November, which delivered the Seoul action plan and pledged to continue co-ordinated efforts to generate strong, sustainable and balanced growth. In this action plan, the advanced economies committed to

“formulate and implement clear, credible, ambitious and growth-friendly medium-term fiscal consolidation plans in line with the Toronto commitment, differentiated according”—

of course—

“to national circumstances.”

Bearing in mind reports of continuing threats to some of our EU partners, does the Minister agree that the International Monetary Fund’s recent growth forecasts underline the need for an ambitious and credible strategy for dealing with the budget deficit?

My hon. Friend is right about that. The IMF clearly supported the efforts that the coalition Government have been making both in the emergency Budget and the spending review to get to grips with the terrible fiscal deficit handed over by the previous Government. The OECD also welcomed the balance that we struck in the spending review between not only protecting growth, but tackling debt.

Can the Minister confirm that the international counterparts discussed the subject of the Republic of Ireland, its deficit and the possible EU bail-out for it? Will that cost the United Kingdom money?

At this stage, we cannot speculate about other countries’ finances. Obviously, the Irish are taking very difficult decisions and actions to try to get the situation under control. I do not think that we should pre-empt actions that Ireland or any other country takes and the impact that such actions may ultimately have on the UK taxpayer.