Taxes must jump 6p in the pound to cut deficit - papers

Taxes must rise sharply over the next decade to bring down borrowing, according to the National Institute of Economic and Social Research (Niesr).

In a report, the think tank said taxes would have to rise by the equivalent of 6p on the basic income tax rate to get the budget deficit below 3% by 2020, writes the BBC.

It also said the UK economy faces sluggish growth and rising unemployment this year.
Niesr expects growth of just 1% this year, followed by 2.25% growth in 2011. FULL STORY...

Austerity Britain will hate its new Government, says King

The Governor of the Bank of England was at the centre of an electoral storm last night after saying that the austerity measures needed to tackle Britain's budget deficit would be so unpopular that whoever wins next week would not get back into government for a generation.

Mervyn King's opinion, revealed hours before the prime ministerial debate on the economy, came as a respected think-tank predicted that taxes would have to rise by the equivalent of a 6p-in-the-pound increase in income tax over the next 10 years.

The Governor's prediction was made to the American economist David Hale, who passed on the remarks in an Australian television interview. FULL STORY...

Bankers are overpaid - RBS chief

The chairman of the part-nationalised RBS has conceded that many bank employees earn too much.

Sir Philip Hampton said it was very difficult to defend the massive gap between what most people earned and what some bank employees were paid.

He said "bankers' pay continues to be astonishingly high".

However, he told BBC Radio 4 that the banks had no choice if they wanted to retain the best people. FULL STORY...