LONDON - A GROUP of Britain's top bosses condemned the government's economic policies on Monday, saying they were 'failing' to meet the 'huge economic challenge' and calling for a 'new direction'.

The letter signed by 11 company chiefs adds to the pressure on Prime Minister Gordon Brown, who is bidding to unify his ruling Labour party and fight back from dismal opinion polls amid challenges to his leadership.

'While we welcome the chancellor's belated recognition that the UK faces a huge economic challenge, we are concerned that the government's economic policy is failing to meet this challenge,' the letter to the Financial Times said.

'The lesson of recent years is clear. Economies must carefully manage public spending and reduce unnecessary budget deficits.'

'They should have simple taxes and competitive tax rates and reduce the burden of regulation. Finally they must improve educational performance.'

'Only then will they be well placed to weather economic difficulties and lay the foundations for long term growth.'

The letter, signed by business figures including JCB chairman Anthony Bamford, Next chief executive Simon Wolfson and Carpetright chairman Lord Harris, comes amid concern about Britain's levels of national debt.

'It is time for a new direction which ensures that in future Britain is better prepared for economic downturns and better placed to compete in a global economy,' the letter said.

The other signatories are: Severn Trent chairman John Egan; Whitbread chairman Anthony Habgood; Mr John Craven, chairman of mining firm Lonmin; Mrs Louise Patten, chairman of commercial property company Brixton; Mr George Robinson, founder of City firm Sloane Robinson; Mr Anthony Fuller, president of brewer Fuller, Smith and Turner; Lord Leach, director of conglomerate Matheson & Co; and Mr Mike Clare, president of bed retailer Dreams. -- AFP