Gordon Brown has defended his plans to increase borrowing to fend off the recession and insists it is the responsible thing to do.

The Prime Minister has set out how he intends to steer Britain through the economic turndown.

But he has already come under attack for committing the country to higher debt levels.

A group of senior economists has criticised the Government's "misguided and discredited" plan to spend its way out of the crisis - urging tax cuts instead.

But in a speech to business leaders Mr Brown said: "We will and can allow borrowing to rise to help restore demand and to come to the aid of workers, businesses and homeowners.

"We have already combined targeted support through the tax system - such as the temporary increase in stamp duty thresholds, the freeze in fuel duty and the £120 tax rebate for basic-rate taxpayers - with a commitment to maintain the necessary government investment to enable Britain to benefit from the upturn."

He added: "Through our actions we are both supporting families and businesses now and helping them prepare for the future. That is why the responsible course is to borrow now to maintain growth and output and to reduce borrowing as a proportion of GDP as the economy recovers and tax receipts rise again."

Mr Brown also highlighted moves to boost the "low-carbon economy" as Transport Secretary Geoff Hoon unveils plans to spend tens of millions of pounds trying to kick-start the market for electric cars.

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