Government rejects EU calls for more fiscal cuts

"We think the EU has got the judgement wrong," Treasury Chief Secretary Liam Byrne told BBC radio.

"We think the plan that they've set out would require us to take something like 20 billion pounds more out of the economy by 2014-15 and we think that would do irreparable damage to public services or to taxpayers."

The opposition Conservatives said the report supported their calls for quicker action on the deficit and promised more information after next week's budget. The budget is one of the last big political set pieces before an election expected in May.

"There will be more details on spending after the budget and before the election," a Conservative Party source told Reuters.

Labour's Byrne was responding to a draft from the EU executive obtained by Reuters which said Britain's fiscal programme failed to guarantee it would meet an EU deadline of 2014-15 for cutting the deficit to below the bloc's cap of 3 percent of economic output.

Cutting the record budget deficit will be a crucial issue in the upcoming election, with Labour trailing the Conservatives in opinion polls.

The plan envisages cutting the gap to 4.7 percent of gross domestic product in the fiscal year 2014-15 from 12.1 percent planned for 2010-2011. That means it will fail to meet a deadline given by EU finance ministers late last year.

Labour, in power since 1997, wants to put off cuts until a fragile economic recovery is assured.

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