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Brown to tackle business concerns Brown defends UK economic record
(about 2 hours later)
Gordon Brown is to address business leaders in Glasgow as questions continue over his future as leader of the Labour government. Britain is well placed to weather the "first financial crisis of the new global age" thanks to Labour's handling of the economy, Gordon Brown has said.
The Scottish CBI will be looking for answers on how he intends to deal with the economic slowdown. The prime minister mounted a defence of the government's record in a speech to business leaders in Liverpool.
Former home secretary Charles Clarke said Labour must change or face "utter destruction" at the next election. He said the UK could avoid the worst of the crisis thanks to a flexible labour market and low interest rates.
But there was no "Blairite plot" to oust Mr Brown, he wrote in the New Statesman magazine. It comes as former Home Secretary Charles Clarke called on him to improve his performance as PM or quit.
Mr Brown is expected to reveal how the government will develop new policies to cope with rising energy prices combined with the credit crunch.
He will admit the government alone does not have adequate means to deal with the global economic crisis.
He is also expected to outline long term measures to end Britain's dependence on oil.
Earlier this week, the Organisation for Economic Co-Operation and Development forecast the economy would fall into recession by the end of the year.Earlier this week, the Organisation for Economic Co-Operation and Development forecast the economy would fall into recession by the end of the year.
Charles is not speaking for the bulk of the parliamentary Labour Party Helen Jones, Labour MP Interest rates
Chancellor Alastair Darling has already said the country is facing the worst economic conditions for 60 years. Mr Brown blamed Britain's economic woes on "unprecedented" coming together of global factors such as rising oil and food prices and the credit crunch.
The business community, and Labour MPs, will be hoping for clarity from Mr Brown on suggestions the government is considering a windfall tax on energy companies to help families pay their fuel bills. "We are dealing, I think people will look back and say, with the first financial crisis of the new global age," he told the gathering of North West of England business leaders.
But, he added, "at root our economy is better placed to weather the global storm than it was in the seventies, the eighties and the nineties".
Low interest rates, thanks to Bank of England independence, a flexible labour market, employment levels close to record highs and the continued investment in public services would help Britain "insulate itself" from the worst of the crisis, he added.
"While no government can hope to protect people from the full impact of the global credit crunch or the spiral in commodity prices, I am determined that we use the resources we have to do whatever we can to help families and business through these difficult time."
He said the government would "continue to make the right long-term decisions for our country" such as ending Britain's reliance on fossil fuels, planning reforms and investment in skills and science.
And the "underlying strength" of British business meant the country was well placed to benefit from the expansion of the global economy when the recovery came.
No 'Blairite plot'
Mr Brown, who is travelling to Glasgow to meet Scottish business leaders, did not refer to the attack on his record as prime minister by former Home Secretary Charles Clarke.
In an article for The New Statesman, Mr Clarke warned Labour faced "utter destruction at the next general election" if it continued on its current course.
He stressed that there was no "Blairite plot" against Mr Brown but there was a "deep and widely shared concern" in the party that Labour was heading for "disaster" coupled with a determination "that we will not permit that to happen".
Asked on BBC Radio 4's Today programme what Mr Brown had to do, he said "establish his authority and set a very clear leadership direction".
And he said the government's performance must improve "significantly" or Mr Brown should "stand down as prime minister with honour and have a proper leadership election and address the proper issues".
Asked how long he gave Mr Brown, the former home secretary said: "I think it's a question of months really."
Mr Clarke's comments in this week's New Statesman come after a lukewarm response to the government's package to revive the housing market, including a stamp duty holiday for properties up to £175,000.Mr Clarke's comments in this week's New Statesman come after a lukewarm response to the government's package to revive the housing market, including a stamp duty holiday for properties up to £175,000.
Mr Clarke, sacked as home secretary 2006, said there was a "deep and widely shared concern" among Labour MPs.
In his article, he calls Mr Brown's decision - in his last Budget as chancellor in 2007 - to abolish the 10p rate of income tax "disastrous and unfair".In his article, he calls Mr Brown's decision - in his last Budget as chancellor in 2007 - to abolish the 10p rate of income tax "disastrous and unfair".
'Not a guide' 'Dad's Army
Mr Clarke, MP for Norwich South, said Tony Blair had been an "outstanding" prime minister, but added: "Blairism as a concept offers little by way of rescue. It is certainly not a guide to action.
"Equally, however, it is inaccurate and misleading to dismiss as some kind of Blairite rump those who fear that Labour's current course will lead to utter destruction at the next general election."
He said there was "no Blairite plot, despite rumours and persistent newspaper reports".
New Statesman political editor's view
"There is, however, a deep and widely shared concern - which does not derive from ideology - that Labour is destined to disaster if we go on as we are, combined with a determination that we will not permit that to happen."
Mr Clarke, seen as a leading Blair supporter, has previously been critical of Mr Brown. In January, he accused Labour of suffering from a "debilitating" lack of direction under him.Mr Clarke, seen as a leading Blair supporter, has previously been critical of Mr Brown. In January, he accused Labour of suffering from a "debilitating" lack of direction under him.
Senior Labour backbencher Helen Jones said Mr Clarke was not representative of most Labour MPs. His comments were dismissed by schools secretary and close Brown ally Ed Balls, who told GMTV: "It's not the first time Charles has made those kind of comments. I think it's Charles being Charles.
She said: "This week our Labour government has started to outline further initiatives to help hard working families - help for first time buyers, and a £120 tax cut this month which will help pay the bills. "I don't think that's where the debate will be when we get to the next general election.
"That's the sort of thing the public wants to hear from all Labour MPs. And fellow Labour MP and former minister Nigel Griffiths told Today Mr Clarke had failed to come up with any alternative policies.
FROM THE TODAY PROGRAMME More from Today programme
"Charles is not speaking for the bulk of the parliamentary Labour Party."
And fellow Labour MP and former minister Nigel Griffiths told BBC Radio 4's Today that Mr Clarke had failed to come up with any alternative policies.
He said: "This is not the first time that he's gone for the old Dad's Army 'we're all doomed', without coming up with any alternative.He said: "This is not the first time that he's gone for the old Dad's Army 'we're all doomed', without coming up with any alternative.
"He sort of lobs a grenade into the party and then backs away. And he did have his chance to come up with alternative policies and he hasn't come up with them.""He sort of lobs a grenade into the party and then backs away. And he did have his chance to come up with alternative policies and he hasn't come up with them."
BBC political correspondent Jo Coburn said although this was not the first time Mr Clarke had publicly criticised the prime minister, he had used very strong language this time and had reopened the issue of Mr Brown's leadership.