Gordon Brown was accused today by the Tories of "irresponsibly" having claimed to have abolished boom and bust as unemployment rose to its worst level since 1999.


Commons leader Harriet Harman acknowledged that ministers were "very much concerned" and not at all "complacent" about the jobless situation.

Standing in for the Prime Minister, who is at a European summit in Brussels, she told MPs it was a "serious moment" for the economy and - using a slogan recently adopted by Tory leader David Cameron - insisted Mr Brown was a "man with a plan".

Shadow foreign secretary William Hague, leading for the Tories, said the lengthening dole queue marked a "grim day" for the British economy.

He branded Mr Brown's boast to have abolished boom and bust "one of the most foolish, one of the most hubristic, one of the most irresponsible claims ever made by a British Prime Minister".

But Ms Harman warned him against "writing off" the British economy, which was made of "sterner stuff," and insisted the Government was determined to take action to "see this country through".

Mr Hague said: "On the day we discover unemployment has risen by 164,000, the largest rise in 17 years, it is a grim day for the British economy and a time of anxiety for many families.

"Given that many companies have been hit by the credit problems, if they can be given some breathing space, job losses can be reduced. Will you now reform the insolvency laws along the lines that we have proposed?"

Ms Harman said the Government had already changed the insolvency provisions under the Enterprise Act in 2003.

"As far as unemployment is concerned, yes, we are very, very much concerned about unemployment and we are not complacent at all about the situation - despite the fact that unemployment is considerably lower than what it was in 1997."

She said the Government had announced £100 million extra to help people who lost their jobs to retrain.

"There are still 600,000 vacancies in the economy and we need to help people who lose their jobs get new jobs.

"There will be extra help too for those who become unemployed, who are homeowners. Instead of having to wait 39 weeks before they get help to pay their mortgage, there will be help after 13 weeks."

Mr Hague said statements about the situation in 1997 may now be regarded as being "complacent," given that unemployment was now expected to rise to three million by 2010, exceeding the rise in the early 1990s.

He said the £100 million programme announced by the Government was spread over three years. "That amounts to £18 per year for each unemployed person.

"And that money has already been allocated to the skills budget and already been announced."

He said it would be a good idea to adopt the proposal made by the Conservatives and save thousands of jobs from going under.

Ms Harman said again that changes in the insolvency laws had been made five years ago, adding: "We are not complacent about the situation in the economy.

"We have made no bones about the fact that our economy faces hard times. But nor should you write our economy off. Our economy is made of sterner stuff.

"The Chancellor and the Prime Minister have said we will take every action we can, not only to stabilise our economy nationally, but to work internationally with other governments to stabilise the global system. That's why he's not here today."

Mr Hague said: "I'm glad you aren't complacent because you wrote in your blog in February that 'people know there is global financial turbulence but are not worried about their own prospects in 2008'.

"Perhaps you will now acknowledge that is no longer the situation.

"If you won't take the measures on insolvency we have proposed, I want to ask about another group of people hit in recent days by the economic crisis - people who have retired, one such group being pensioners forced to buy an annuity on retirement or at age 75."

Mr Hague said they would be "locked into a lower income for the rest of their lives" and again urged the Government to suspend this rule, adding: "Can you now cut through the delay and announce a decision, to suspend this rule, helping the incomes of thousands of pensioners into the future."



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