Britain's Labour party dismissed comparisons between the UK and Greece today as the issue of getting a record budget deficit under control returned to the fore ahead of next week's election.
Vince Cable, treasury spokesman for the Liberal Democrats, said the country risked sliding into a Greek-style financial crisis unless the next government took drastic action to cut borrowing.
Greece, which saw its debt downgraded to junk status by rating agency Standard & Poor's on Tuesday, is currently in talks with the IMF and the European Union on getting a €45 billion bail-out package to prevent a sovereign default.
Greece's budget deficit last year stood at 13.6 percent of GDP, compared to a British deficit running at over 11 percent.
Labour business minister Lord Mandelson said that likening Britain to Greece was "frankly ridiculous".
"We are in a very, very different situation in Britain from that in Greece," he told reporters. "The UK economy is growing ... it is gaining strength and will do during the course of this year. In contrast Greece is in recession."
The economy, a key campaign battleground, was back in focus after a think-tank criticised all parties for the lack of detail in their fiscal plans ahead of the final television leaders' debate tomorrow, which will focus on economic policy.
Repairing the public finances will be the biggest domestic policy challenge for whichever party wins the May 6th election, but the parties have been reluctant to risk voters' wrath by clearly identifying the extent of cuts.
The Institute for Fiscal Studies said yesterday that the impending spending squeeze would be the sharpest in at least 30 years and warned the parties would likely have to raise taxes more than they are prepared to admit.
All three major parties agree tough fiscal tightening is needed to reduce the budget deficit, but they differ over when the pain should start and how to share the burden.
Lord Mandelson, opposition Conservative finance spokesman George Osborne and Mr Cable will come under scrutiny over their respective plans for the economy as they face questions from business leaders in London.
Finance minister Alistair Darling will also make a speech on the economy later.
Liberal Democrats leader Nick Clegg said Labour, in power for 13 years, lacked energy, and the election had now become a choice between "two competing pitches for change".
"This is now a two-horse race between the Conservative Party and the Lib Dems," he said.
Opinion polls today continued to point to a hung parliament, but showed the Conservatives and Labour had regained some ground from the Liberal Democrats, who have enjoyed a ratings boost since the first TV leaders' debate.
Mr Clegg faces prime minister Gordon Brown and Conservative leader David Cameron tomorrow in the third and final TV debate.
Reuters