Monday, 24 May 2010

Osborne wields the axe with a £6bn cuts package

This morning the Chancellor George Osborne and the Chief Sectary of the Treasury David Laws, unveiled a £6.2 billion cuts package of what they called "wasteful spending" to start to reduce the budget deficit.

There will be cuts to quangos, spending on consultancy and big IT projects,a civil service recruitment freeze and shamefully axeing the Child Trust fund.

Of the cuts identified, £500m is to be reinvested in further education, apprenticeships and social housing, leaving a net spending cut of £5.7bn - less than 1% of total government spending.

The savings, according to the government, will break down as:

•£1.15bn in "discretionary areas" like consultancy and travel costs, £95m through savings in IT spending, £1.7bn through delaying/stopping contracts and projects and renegotiating with suppliers

•£170m from reducing property costs, at least £120m from a civil service recruitment freeze and £600m from reducing quango costs and £520m from other "lower value" spend

•And local authorities - which will be expected to save £1.165bn - will be given more "flexibility" to find savings as "ring-fences" around government grants are being removed.

Every single Government department apart from Health, Defence and International Development has been instructed to slash millions from their budgets.

Transport - £683m

Communities & Local Government - £780m

Local Government DEL - £405m

Business - £836m

Home Office - £367m

Education - £670m

Ministry of Justice - £325m

Law Officers Department - £18m

Foreign Office - £55m

Energy and Climate Change - £85m

Environment, Food, Rural Affairs - £162m

Culture, Media and Sport - £88m

Work and Pensions - £535m

Chancellor's Departments - £451m

Cabinet Office - £79m

Devolved administrations - £704m

The former Chancellor, Alistair Darling rightly criticised his predecessor, George Osborne, for making this announcement just 24hours before the state opening of parliament, arguing he could have made the announcement tomorrow in the House of Commons, and be held to account by MPs on these spending cuts. He also said Mr Osborne must "come clean" on the details, how many jobs were at risk and how it would effect growth in the economy.

It is disgraceful the way this new coalition government is constantly briefing how Labour spent all the money, how Labour mismanages the economy, everything is Labour fault.

Quite frankly, YES Labour did spend all the money, YES Labour did borrow the highest amount of money in this nation's peace time history, and I, as a member of the Labour Party will never apologise for that.

I'll tell you why the Labour Government borrowed and spent over £170 billion - because when the Global Economic Recession struck, corporate tax receipts dried up, taxes from the banks dried up and so did the taxes of the hundreds of thousands of people that became unemployed due to the downturn. It was imperative for the Government of the Day, to borrow money to keep the British Economy moving, which incidentally stop us going from recession to depression.

Thank you Gordon Brown and Alistair Darling for saving Britain from that econmic catastrophe.