“This was made clear to the Labour Party by the Liberal Democrats during the negotiations. But they chose to remain in denial and they’re choosing to remain in denial now.
“By trying to score desperate political points, Labour MPs wilfully ignore the fact the Governor of the Bank of England supports the Coalition’s approach to handling the economy.”

ENDS

Notes to Editors:

At a press conference on May 12, Mervyn King said:
“The most important thing now is for the new government to deal with the challenge of the fiscal deficit. It is the single most pressing problem facing the United Kingdom; it will take a full parliament to deal with, and it is very important that measures are taken straight away to demonstrate the seriousness and the credibility of the commitment to dealing with that deficit.
“And I have been told what is in the agreement between the Conservatives and the Liberal Democrats this morning, and I am very pleased that there is a very clear and binding commitment to accelerate the reduction in the deficit over the lifetime of the parliament, and to introduce additional measures this fiscal year to demonstrate the importance of getting to grips with that before running the risk of an adverse market reaction. I think we've seen in the last two weeks, particularly, but in the case of Greece, over the last three months, that it doesn't make sense to run the risk of an adverse market reaction, but to get ahead of that and to demonstrate - markets have been waiting for the UK Election; that is now over. They would expect a new government to take decisive action. And the agreement that I've been informed about, that was reached between the Conservatives and Liberal Democrats is a very strong and powerful agreement to reduce that deficit and to take more action than was embodied in the Budget in the spring.”