British Chancellor warns EU not to interfere

British Chancellor Gordon Brown was today warning the European Commission not to interfere in the Treasury’s spending plans.

Mr Brown is furious at pressure from Brussels to cut his budget programme and keep inside EU budget deficit guidelines - guidelines designed to ensure countries in the euro maintain manageable economies.

If Britain was in the euro, the Commission would have power to fine the government if the national budget deficit slipped above 3% of national wealth.

As it is, the commission can only advise - but even that is too much for Mr Brown.

Criticism of the British government’s borrowing plans is also a gift to eurosceptics who claim the UK Treasury will be effectively run by Brussels if the country ditches the pound and joins euroland.

The commission wants Mr Brown to balance the British budget, a move which would mean cutting his spending programmes by £10bn (€16bn) a year.

The Chancellor has warned that could mean slashing expenditure on health, education, transport and the police, and he will not do it.

He is borrowing more than 1% of national wealth to plough into public services.

He will tell the commission at talks between EU finance ministers in Brussels that it is overstepping the mark in the way it is monitoring and commenting on national spending programmes.

The commission is also risking antagonising Britons who will be given a say in a referendum on whether the UK should throw in its economic lot with the euro-zone.

Mr Brown is not alone in trying to fend off commission interference: Germany is being threatened with an ‘‘early warning’’ that it is heading for the unbreakable 3% budget deficit ceiling.

It was Germany which insisted on such budgetary rigours, demanding a ‘‘stability and growth pact’’ as part of the switch to a single currency.

But now Berlin, like the UK, feels the commission is exceeding its role in telling major EU economies how to run their finances.