LONDON Oct 6 Finance minister Philip Hammond
will set out next month how Britain will try to rely less on
ultra-low interest rates that have hurt savers, and focus more
on other ways to boost growth, an adviser to Prime Minister
Theresa May said.
In a speech on Wednesday, May said there had been bad
side-effects from the Bank of England's emergency measures to
protect the economy since the financial crisis and the time had
come for a new approach to spurring growth.
The head of her policy unit, George Freeman, said the
government had to "listen to the roar that we heard this year",
when voters decided by a narrow majority that Britain should
leave the European Union in what was seen as a protest over
Freeman said the BoE - which in August cut interest rates to
a record low and launched a new round of bond buying - would
remain free to decide its policy, echoing comments made by May's
aides after her speech.
"It's up to the BoE obviously to set out with their mandate
how they handle that," Freeman told BBC television in an
interview broadcast late on Wednesday.
"But she (May) is signalling loud and clear that we need to
make sure that we understand what effect that this model of
growth has had on those who are paying for it, the citizens of
this country, and to use every lever that we have to make sure
that the economy works for them."
He said near-zero borrowing costs for the government offered
an opportunity to increase public investment.
"We have to think about, with money available at nought
percent (how to) ... drive an industrial strategy, get
infrastructure built. We need to make sure we are looking at all
the mechanisms to making sure that money flows properly,"
Freeman told the BBC.
Hammond is due to deliver his first budget speech on Nov.
23. He has suggested that he favours "modest" infrastructure
projects as a way to help Britain's economy cope with the impact
of the Brexit vote.
BoE Governor Mark Carney has previously said that ultra-low
interest rates, while tough for savers, had helped the economy
avoid a deeper downturn after the global financial crisis which
would have caused more pain for Britain as a whole.
(Writing by William Schomberg; editing by John Stonestreet)