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‘Purring’ Queen and deficit drop: UK leader gaffes

U.K. Prime Minister David Cameron was readying himself for might be one of his most apologetic phone calls to the Queen on Wednesday, when he was caught describing the 88-year-old great-grandmother as "purring down the line."

In a conversation with Michael Bloomberg, picked up by microphones, Cameron was caught telling the former New York mayor how pleased the Queen was that Scotland had voted to stay part of the United Kingdom.

While U.K. Prime Ministers have regular conversations with the Queen, they are normally shrouded in secrecy. The Queen is supposed to be impartial and show no favouritism, so any comment made to a politician should be strictly confidential.

Cameron is not alone among U.K. politicians in making a gaffe in the last 24 hours.


Where's the deficit gone?

Ed Miliband, the leader of the U.K.'s opposition Labour Party, forgot to deliver a couple of key elements to one of the most important speeches of his political career, leading to howls of derision from chief rivals the Conservative Party.

Speaking without notes, one of his trademarks, he missed out key passages on addressing the U.K. deficit and immigration – two vital subjects for a political U.K. leader to tackle if they want to portray competence and authority.


Miliband, who acknowledged that he was facing a eight-month job interview to be the next Prime Minister, set out a series of plans to raise taxes and target hedge funds, in one of his most important speeches ahead of next year's U.K. elections. Labour is currently slightly ahead of the Conservative Party in the polls, with the latest survey from YouGov for The Sun, suggesting 35 percent of respondents would vote for Labour in May's election, against 33 percent for the Conservatives.

Miliband also pledged to increase spending on healthcare, by hiking taxes for those who own homes worth more than £2 million, for tobacco companies and by clamping down on tax avoidance.

Critics also suggested that he wasn't clear enough on how to reduce the U.K.'s deficit.


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"There's no doubt that Ed Miliband has ambition for Britain and we share his desire to build more homes, raise living standards and remain in a reformed European Union," John Cridland, CBI director-general, said in a statement.

"But we heard very little about how to create the economic growth to deliver these ambitions and the crucial role of healthy and thriving businesses in creating prosperity for all."

Hedge funds trimmed

If elected, Miliband has pledged to target a tax loophole often used by hedge funds. Critics warned that stopping the ability of funds to avoid tax, by getting banks to buy shares for them, could also affect other longer-term investors.

Russell Morgan, EY tax partner, said: "While the detail of the proposals isn't clear yet it's going to be hard to design a a new rule that could target only the hedge fund industry and not individual investors and others who choose to invest in UK shares through derivatives for a wide variety of reasons."

The traditionally left-wing Labour Party moved to the centre of U.K. politics, developing more business-friendly policies, under former Prime Minister Tony Blair's reign as leader, but under Miliband has moved slightly more to the left.

- By CNBC's Catherine Boyle