This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.

You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/uk_politics/7776962.stm

The article has changed 6 times. There is an RSS feed of changes available.

Version 0 Version 1
Ministers shrug off German attack Ministers shrug off German attack
(10 minutes later)
Government ministers have shrugged off criticism from Germany's finance minister of Gordon Brown's plans to combat the economic downturn.Government ministers have shrugged off criticism from Germany's finance minister of Gordon Brown's plans to combat the economic downturn.
Peer Steinbruck criticised the decision to cut VAT and raise national debt levels, saying the UK's response to the crisis was "crass" and "breathtaking".Peer Steinbruck criticised the decision to cut VAT and raise national debt levels, saying the UK's response to the crisis was "crass" and "breathtaking".
But Ed Balls defended the policy as the "right thing to do" and said it was the Conservatives who were "isolated".But Ed Balls defended the policy as the "right thing to do" and said it was the Conservatives who were "isolated".
And Jacqui Smith said she "disagreed" with Mr Steinbruck's analysis.And Jacqui Smith said she "disagreed" with Mr Steinbruck's analysis.
But the BBC's Norman Smith said No 10 was keen to play down any disagreement between the two countries.But the BBC's Norman Smith said No 10 was keen to play down any disagreement between the two countries.
Downing St says that Germany has introduced its own package of extra spending and that German Chancellor Angela Merkel is sympathetic to the British approach.Downing St says that Germany has introduced its own package of extra spending and that German Chancellor Angela Merkel is sympathetic to the British approach.
Mr Steinbruck's comments, in an interview with Newsweek magazine, represented an unusual breach of standard diplomacy.Mr Steinbruck's comments, in an interview with Newsweek magazine, represented an unusual breach of standard diplomacy.
He questioned the effectiveness of the decision to cut VAT from 17.5% to 15%, saying "are you really going to buy a DVD player because it now costs £39.10 instead of £39.90?".He questioned the effectiveness of the decision to cut VAT from 17.5% to 15%, saying "are you really going to buy a DVD player because it now costs £39.10 instead of £39.90?".
We need to save the world from a deeper downturn and we will only do that by concerted international action together Ed Balls Germany 'out of step' on downturnWe need to save the world from a deeper downturn and we will only do that by concerted international action together Ed Balls Germany 'out of step' on downturn
"All this will do is raise Britain's debt to a level that will take a whole generation to work off," he added."All this will do is raise Britain's debt to a level that will take a whole generation to work off," he added.
Mr Steinbruck questioned why Britain was "tossing around billions" and closely following the high public spending model put forward by 20th Century economist John Maynard Keynes.Mr Steinbruck questioned why Britain was "tossing around billions" and closely following the high public spending model put forward by 20th Century economist John Maynard Keynes.
"The switch from decades of supply-side politics all the way to a crass Keynesianism is breathtaking," he said."The switch from decades of supply-side politics all the way to a crass Keynesianism is breathtaking," he said.
'Robust views''Robust views'
Schools Secretary Ed Balls hit back, suggesting the comments had more to do with Germany's internal politics in its ruling coalition than the nature of the global response to the economic downturn.Schools Secretary Ed Balls hit back, suggesting the comments had more to do with Germany's internal politics in its ruling coalition than the nature of the global response to the economic downturn.
He said Mr Steinbruck was known for his "strong and robust views" but he defended the UK's course of action in cutting taxes and raising borrowing, saying it had widespread support across the world. Mr Steinbruck is a member of the Social Democratic Party which shares power with Angela Merkel's rival Christian Democrats.
Mr Balls said Mr Steinbruck was known for his "strong and robust views" but he defended the UK's course of action in cutting taxes and raising borrowing, saying it had widespread support across the world.
"It is the right thing to do to act now to keep jobs, to keep people in their homes and to keep the economy moving," he told Sky News."It is the right thing to do to act now to keep jobs, to keep people in their homes and to keep the economy moving," he told Sky News.
"We need to save the world from a deeper downturn and we will only do that by concerted international action together. Britain, and Gordon Brown, is leading that action." Mr Steinbruck has not minced his words "We need to save the world from a deeper downturn and we will only do that by concerted international action together. Britain, and Gordon Brown, is leading that action." Mr Steinbruck did not mince his words
He added: "I think Germany will join the international consensus when their internal politics are sorted out."He added: "I think Germany will join the international consensus when their internal politics are sorted out."
Shadow chancellor George Osborne has said Mr Steinbruck's comments shattered Labour's charge that only the Conservatives oppose the VAT measures.Shadow chancellor George Osborne has said Mr Steinbruck's comments shattered Labour's charge that only the Conservatives oppose the VAT measures.
But Mr Balls maintained that the Tories were "isolated" over the need for fiscal action to support the economy, saying they were "out of step with the British people and the rest of the world".But Mr Balls maintained that the Tories were "isolated" over the need for fiscal action to support the economy, saying they were "out of step with the British people and the rest of the world".
Home Secretary Jacqui Smith said the government was doing what was needed to support the economy and its approach was widely supported by the business community.Home Secretary Jacqui Smith said the government was doing what was needed to support the economy and its approach was widely supported by the business community.
"I disagree with him," she told the BBC, referring to Mr Steinbruck's comments."I disagree with him," she told the BBC, referring to Mr Steinbruck's comments.
"What is important is that Gordon Brown and Alistair Darling are taking the action which we think is necessary and which has actually led the way internationally as well as helping us to get the country through a difficult economic time.""What is important is that Gordon Brown and Alistair Darling are taking the action which we think is necessary and which has actually led the way internationally as well as helping us to get the country through a difficult economic time."
Rescue packageRescue package
The chancellor announced in last month's pre-Budget report that the government would inject an extra £20bn into the UK economy in a bid to get it moving again.The chancellor announced in last month's pre-Budget report that the government would inject an extra £20bn into the UK economy in a bid to get it moving again.
At least £15bn of this total will come from increased government borrowing, which is expected to take the UK's total public borrowing to £118bn next year.At least £15bn of this total will come from increased government borrowing, which is expected to take the UK's total public borrowing to £118bn next year.
While Mr Steinbruck has accused the UK of over-spending on the economic recovery, the German government has put 480bn euros (£370.4bn; $645bn) into a rescue package for its banks.While Mr Steinbruck has accused the UK of over-spending on the economic recovery, the German government has put 480bn euros (£370.4bn; $645bn) into a rescue package for its banks.
Most other European governments have also increased public spending to try to ease the impact of the economic downturn.Most other European governments have also increased public spending to try to ease the impact of the economic downturn.
France recently announced plans to spend 26bn euros, and the European Commission wants to spend 200bn euros across the EU.France recently announced plans to spend 26bn euros, and the European Commission wants to spend 200bn euros across the EU.
Prime Minister Gordon Brown will attend an EU summit on the economic crisis in Brussels later. French President Nicolas Sarkozy said countries must show "vision and a spirit of compromise" to navigate their way through the downturn.Prime Minister Gordon Brown will attend an EU summit on the economic crisis in Brussels later. French President Nicolas Sarkozy said countries must show "vision and a spirit of compromise" to navigate their way through the downturn.
"We shall be required to take a series of decisions with highly significant implications for the future of Europe," he wrote in a letter to other European leaders."We shall be required to take a series of decisions with highly significant implications for the future of Europe," he wrote in a letter to other European leaders.
"I am determined that the European Council lives up to its responsibility and to citizens' expectations.""I am determined that the European Council lives up to its responsibility and to citizens' expectations."