Gordon Brown yesterday dismissed the prospect of an early election by stating that he is "100% focused" on the ailing economy.

A dose of winter election fever is gripping Westminster ahead of Monday's tax-cutting mini-Budget, but the Prime Minister dampened speculation that he would go for a spring or summer 2009 contest.

With Labour and the Conservatives now separated in opinion polls by a three-point gap and Mr Brown's handling of the economic crisis improving his previously diastrous personal ratings, the political runes show that he will be tempted to go to the country.

But having shot his own credibility a year ago by over-calculating on a snap November election, Mr Brown yesterday swerved wide of the issue. Asked about reports suggesting he was considering a poll on June 4, to coincide with the European elections, Mr Brown said: "You can discount all of these stories."

Observers noted that the Prime Minister did not explicitly rule out an early election. Mr Brown might still take the plunge while the effects of his proposed "fiscal stimulus" are apparent and unemployment is within acceptable limits.

The pre-Budget report - with tax cuts for low earners and possible increased borrowing of up to £120bn, almost 8% of GDP, balanced by repayment through tax rises at a later date - will be laid before the Commons by Chancellor Alistair Darling on Monday.

New measures to push the banks to lend more will be announced in the pre-Budget report as both the Prime Minister and Mr Darling let it be known they believe the big banks are still not doing enough to make credit available to British companies, especially small businesses.

The UK Government is spending £37bn taking large stakes in Lloyds TSB, HBOS and Royal Bank of Scotland. In exchange for the capital, the banks have committed to returning their lending to 2007 levels.

All parties will be watching the poll reaction as much as the economic one as soon as the Chancellor sits down. Labour's ratings plummeted last November and Mr Brown was characterised as a "ditherer" after he allowed rumours of a snap election to build up unchecked.

By summer, support for Mr Brown and Labour was at rock bottom and there was a misfired attempt at a coup before the party conference.

For most of this year, it was widely assumed that Mr Brown would delay calling an election until 2010, the last date available under the rule preventing parliaments from sitting more than five years, but the economic turmoil, which plays to Mr Brown's serious strengths, has put new wind in his sails.

Douglas Alexander, Labour's election co-ordinator, has stated he has not held any discussions with the Prime Minister about the election date but the return of Lord Mandelson to Cabinet, as Business Secretary and effectively deputy prime minister, gives him a greater say in calling the date.

Thursday June 4 presents itself not just because of the European election but also because Mr Brown will have just finished hosting the G20 in London, probably with US President Barack Obama in attendance, and the fiscal stimulus will have come through to people's pockets.

But when challenged on the date in a radio interview yesterday, Mr Brown said: "My undivided attention is on the economy. I am not thinking about anything else."

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