No 10 dismisses Gordon Brown’s warning of UK ‘sleepwalking into financial crisis’ | Politics

Downing Street has rejected Gordon Brown’s warning that the UK is at risk from a worldwide drift towards a new financial crash, insisting that a revamped UK regulatory regime would properly insulate the country.

Brown, who was prime minister at the time of the 2008 crash, said that after a decade of stagnation the global economy was now moving into a decade of vulnerability.

He told the Guardian: “We are in danger of sleepwalking into a future crisis. There is going to have to be a severe awakening to the escalation of risks, but we are in a leaderless world.”

Asked if Theresa May agreed with Brown’s analysis, the prime minister’s spokeswoman said: “No. Since 2008 we have built one of the most robust regulatory systems in the world, designed specifically to ensure financial stability and protect taxpayers.”

Asked if the PM was confident the UK would not suffer any adverse consequences, even with a potential loosening of regulations in the US, the spokeswoman said: “In recent years we have reformed regulation of the City, and put in place an incredibly robust system, [while] at the same time making sure it’s globally competitive.

“We’ve taken action ourselves to make sure that our system is resilient and robust.”

Brown said there was less scope to reduce interest rates than was the case a decade ago, no evidence that finance ministries would be allowed to cut taxes or increase public spending, and no guarantee that China would be as active in providing stimulus.

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He said: “The cooperation that was seen in 2008 would not be possible in a post-2018 crisis both in terms of central banks and governments working together. We would have a blame-sharing exercise rather than solving the problem.”

In the light of the trade war launched against Beijing by the US, Brown doubted that China would be as cooperative a second time. “Trump’s protectionism is the biggest barrier to building international cooperation,” he said.

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