Published by Jamie JemmesonThe damning European Commission report calling for swift decisive policy action to cut the UK's deficit has been rubbished by Treasury chief secretary Liam Byrne.Speaking to the BBC, the MP declared: "We think the EU has got the judgment wrong. The plan that they've set out would require us to take something like £20 billion more out of the economy by 2014-15 and we think that would do irreparable damage."The report sent the pound tumbling in foreign exchange trading yesterday as forex dealers anticipated further ructions in the UK economy.The leaked document was highly critical of the Treasury's response to the spiralling budget deficit, which is now running at 12 per cent, and called for a policy strategy to be implemented that would bring the public debt back in line with EU caps of three per cent.In response, the Conservatives welcomed the report and looked to place distance between the two main parties on the issue of managing debt ahead of the general election later this year.For more information on international payments, visit our Smart FX site