UK strategies for addressing the budget deficit have been sharply criticised in an EU report, following a warning by Brussels earlier in the week that the UK was not on track to cut its deficit by a deadline of 2015.
"The overall conclusion is that the fiscal strategy in the convergence programme is not sufficiently ambitious and needs to be significantly reinforced," the report by the European Commission said, noting that the fiscal stimulus had "provoked a considerable deterioration in UK public finances".
The UK's budget deficit is expected to reach £178bn, or 12.6% of GDP, this year although EU rules stipulate that government deficits must be below 3% of GDP. UK Chancellor Alistair Darling has argued that cutting the deficit quickly through a reduction in government spending would harm the UK's emergence from recession.
The Commission has suggested that Britain should "strengthen the pace of medium-term consolidation" to ensure the target of 2015 is met. Germany, France, Spain and Italy were also criticised for their reliance on 'optimistic' growth assumptions to meet debt targets.
