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The Chancellor, George Osborne stood up in the House
Commons to detail the largest series of public spending cuts seen in
decades.
Mr Osborne
told MPs that the reductions in expenditure, totalling almost £83
billion, were needed to draw Britain "back from the brink".
The
comprehensive spending review, which has been the most important in
generations, would eliminate the UK's structural deficit by 2014/15
and would see national debt falling significantly over the same
period.
Current debt interest payments total £43 billion a
year. Debt interest payments will be lower by £1 billion in 2012,
£1.8 billion in 2013 and £3 billion in 2014, a total of £5 billion
over the course of the review, the Chancellor said.
Capital spending will be £51 billion next year, then
£49 billion, then £46 billion and £47 billion in 2014-15, roughly £2
billion a year higher than set out in the Budget.
Total public expenditure, which includes debt
interest payments, will be £702 billion next year, then £713
billion, £724 billion and £740 billion, bringing real terms public
spending to the same level as 2008.
The coalition government's plans would set the both
public services and the welfare system on what Mr Osborne described
as a sustainable footing. The cost will be the loss, as predicted by
the Office for Budgetary Responsibility, of some 490,000 public
sector jobs by 2015.
The changes to the welfare system were perhaps the
most marked of all the planned reductions in spending, with some £7
billion more of funding to be withdrawn over the next four years.
The squeeze on welfare budgets meant that the
Chancellor was able to inform the House that, as an average,
departmental cuts across Whitehall amounted to 19 per cent, one per
cent lower than the estimate put forward by the previous Labour
administration in their own plans for combating the deficit.
Mr Osborne insisted that the deep financial
retrenchment was based on reform, fairness and growth, the road
ahead hard but leading to a better future.
The health budget will rise by 0.4 per cent annually
in real terms over the next four years, its annual spend hitting
£114.4 billion by 2015.
The education budget is also to enjoy an increase in
funding each year, and a £2.5 billion pupil premium pot will be set
aside to support the education of poor and disadvantaged children.
Inevitably, there were cuts elsewhere, with most
departments set significantly stringent spending targets for the
duration of the current Parliament.
The Home Office is to lose 6 per cent a year. Police
budgets are to face a 16 per cent cut over the next four years.
The MOD must deal with cuts of 8 per cent; the
Foreign Office 24 per cent; and the Cabinet Office 35 per cent.
Although the Department of Business is to lose 25 per
cent of its funding over the course of the next four years, the
science budget is to remain at £4.6 billion a year, so protecting
the teaching of and research into STEM subjects such as technology,
maths and engineering.
The government also committed itself to increase
spending on adult apprenticeships by £250 million a year, creating
an extra 75,000 apprenticeship places. |
