Gordon Brown hints at fresh tax cuts in the Budget - papers

A fresh stimulus to the economy through tax cuts or spending on public works projects could come in the April Budget, a government document released by Gordon Brown hinted yesterday, according to The Times .

The Prime Minister published his 74-page blueprint for world leaders who will be attending the G20 summit in London in April, calling on them to increase the International Monetary Fund's resources, renounce protectionism and reform world financial institutions.

He said the 20 leaders must strike a "grand bargain" to deal with the economic downturn with co-operation on banking reform and fiscal stimulus packages.

Within the document, however, there is a strong suggestion that the economic injections made so far may not be sufficient. There are already suggestions in Whitehall that Alistair Darling is working on a second package to follow that in the Pre-Budget Report in November when he cut VAT by 2.5 per cent - a move defended strongly in the paper.

Lord Mandelson's famed silver-tongue deserted him on a business trip to New York when he responded with a four-letter tirade against one of America's most senior entrepreneurs, the Starbucks boss Howard Schultz, The Independent reports.

The American, chief executive of the world's biggest coffee chain, spoke of his corporation's recent struggles in a television interview. "The concern for us is western Europe and specifically the UK," he said. "The UK is in a spiral." Mr Schultz described consumer confidence in Britain was "very, very poor".

The furious Business Secretary resorted to an uncharacteristic Anglo-Saxon turn of phrase, storming at a cocktail party in New York: "Why should I have that guy running down the country? Who the fuck is he?" Lord Mandelson added a withering comment on Starbucks' assessment of the UK economy, adding: "How the hell are they doing?"

Starbucks plans to close 900 of its 16,000 outlets worldwide as consumers buy fewer £2-a-time lattes and mochas.

Lord Mandelson, on a brief visit to New York to bang the drum for British business, overheard an interview by the normally-careful Mr Schultz, and the Business Secretary's face reddened.

In a public interview on the CNBC TV station, he used less fragrant language but was no less damning in his comments: "The UK is not spiralling, although I have noticed that Starbucks is in a great deal of trouble. But that may be because of their over exposure given the state of the market. So please do not project Starbucks on to the UK economy as a whole."

The Bank of England is to start 'printing' new money for the first time in 30 years as it runs out of options to kick-start the economy, according to The Independent.

The Governor of the Bank of England will write to the Chancellor within days to get permission for the unprecedented action. The Bank will create the money by buying government and corporate bonds from financial institutions for new supplies of sterling.

Termed "quantitative easing", it is the modern equivalent of printing money. It is designed to put more cash into the economy, creating more money for companies to spend and for banks to lend.

The move marks the most dramatic step taken yet by the Bank as it tries to stop the deepening recession turning into a slump. One of the main reasons for the financial crisis has been the unwillingness of banks to lend money after the sub-prime losses in the US.

Critics have branded the action irresponsible and said it could stoke inflation and spark a run on the pound but the severity of the recession has driven the usually conservative central bank to throw caution to the wind.