IMF: UK must act to reduce debts

THE GOVERNMENT has been warned it has to come up with “credible and consistent policies” to prevent the economy from destabilising, in a report by the International Monetary Fund (IMF).

Ajai Chopra, the IMF’s mission chief to the UK, said “significant vulnerabilities” exist in the financial sector and warned the pound could be destabilised if the government doesn’t bring its own financial situation under control.

He said Alistair Darling’s Budget 2009 did not plan to bring down the government’s debts fast enough to avert a crisis.

But the report commended the government for being “ahead of the curve” in its policies to stabilise the banking system.