Business secretary hints at tax cuts

Tax cuts and sustainable borrowing could form a key part of the Pre-Budget statement, according to the secretary of state for business.

In an interview with the BBC this morning (21 November), Peter Mandelson dropped a major hint that Chancellor Alistair Darling would cut taxes on Monday when he addresses the House of Commons.

In particular, he suggested that the cuts would be focussed on the "save less, spend more" low to middle earner demographic, in a move that would be more likely to revitalise the economy.

Speaking to BBC Breakfast, Lord Mandelson said: "We've got to make sure that the borrowing we undertake now and the fiscal measures the Chancellor announces next Monday - and there may be a combination of tax cuts and sustained borrowing - can be paid for in the medium term."

He added that a combination of measures was needed to make the recession as short and as painless as possible.

The Chancellor will make his Pre-Budget statement at 15:30 GMT next Monday.