British finance minister Gordon Brown was widely expected later on Monday to slash his Labour government’s optimistic economic growth target for 2005, when delivering his pre-budget report to parliament.

Brown, who has been chancellor of the exchequer since Labour’s return to power in 1997, is seen as the front-runner to lead his country when Prime Minister Tony Blair steps down.

Blair, re-elected in May, has promised to run for a full third-term but to retire as prime minister before the next general election, expected in four or five years’ time.

A large downgrade to Brown’s annual economic growth forecast of 3.0-3.5 per cent could damage the chancellor’s credibility and chance of succeeding Blair, according to some analysts. "With the economy showing increasing signs of strain, the chancellor needs to defend a legacy that is now increasingly coming into question," said Gavin Redknap, an economist at Standard Chartered. Economists are forecasting British growth of between 1.70-1.75 per cent for 2005, way below Brown’s official prediction.

Brown had acknowledged in September that gross domestic product (GDP) growth would not meet his official target range forecast last March, citing the faltering global economy and high oil prices. The finance chief briefed government ministers earlier on Monday, according to Blair’s spokesman, who quoted Brown as saying that the pre-budget report followed a year in which "the UK came face to face with the full force of global economic change".

British newspapers have speculated that Brown may introduce a new tax for the oil sector, which has benefited from record oil prices in 2005.