Up to 40% cuts in UK Govt spending?

[Rum]

From the BBC at http://news.bbc.co.uk/1/hi/uk/10500081.stm


Departments told to draw up plans for 40% spending cuts

The Treasury has told most government departments to prepare "illustrative plans" to cut spending by 40% - as well as the expected 25% - within the month.

Education and defence have been given some protection, and must produce plans to cut 10% and 20%. International aid and health budgets are being protected.

The full 40% plans are unlikely to be implemented but will inform future decisions on cuts, the BBC understands.

Labour says the news will raise fears about the future of frontline services.

The government says cuts are needed to reduce the UK's £156bn annual budget deficit - the amount it must borrow each year to plug the gap between public income and spending.

The government is sending out confusing messages: it's asking most departments to say what 40% cuts would look like but briefing journalists that this isn't going to happen. So what's going on?

Sparing education spending in England and Wales and defence spending from the worst of the pain means other departments will have shoulder more of it.

The average cuts of 25% mentioned in last month's budget were just that, an average. That means some areas will have to see deeper reductions - the Institute for Fiscal Studies estimated 33% might be asked for.

But what this exercise will give ministers is a menu of choices; from that they will be able to see what the effects of their deficit reduction strategy will be.

The summer is going to be a long negotiation for ministers, with departments arguing their case to persuade the Treasury that someone else should get the chop.

We'll know the final settlement on 20 October - in the meantime expect anger from the unions and no doubt plenty of threats of industrial action.

However, public sector unions are threatening "co-ordinated industrial action" if ministers try to implement cuts as deep as 40%.

BBC political correspondent Gary O'Donoghue said ministers were told by the Treasury at a cabinet meeting in Bradford last Tuesday to draw up what are being called illustrative plans, and have them ready by the end of July.

Sources have stressed that Labour's pre-election plans had already implied cuts of 20% around Whitehall, he said.

Privately, they say that no department will actually face 40% cuts.

However, all departments have also been told to look at cutting their administration costs by a third, or even a half.

These are not final settlements - but they will allow ministers to see the concrete results of cutting budgets, our correspondent added.

Prior to the election, the Conservatives pledged to cut an additional £6bn above Labour's planned spending reductions.

Labour and the Liberal Democrats campaigned on the basis that to cut spending so deeply this year would threaten the economic recovery.

However, the Lib Dems - now in coalition with the Conservatives - have argued that since the election, the markets' loss of confidence in Europe's economies calls for swifter action.

A Labour Party spokesman said the talk of "swingeing, across the board cuts" would worry people that the government would not protect frontline public services and that tackling the deficit had to be done in a fair way.

"Already, we have seen the government showing an appetite for cuts and tax rises that particularly hit families on middle and modest incomes," he said.

"When it comes to departmental spending, the government should be willing to sacrifice some of its unworkable pet projects - like Swedish schools or political police commissioners - before making cuts that will damage the quality of the frontline services people rightly expect."
'Social consequences'

John Philpott, chief economist at the Chartered Institute for Personnel and Development, said the government had made clear that as well as cutting the fiscal deficit it wanted a "once in a generation reform of the public sector".

"Clearly it means the government has in its sights quite swingeing cuts," he said.

But he added that the option was only what "might" and not what "would" happen.
Continue reading the main story

We will see not just co-ordinated industrial action by unions but campaigns in every community

"If you delivered job cuts of that size it would not only hit back office functions, management and admin but it is inevitable it would be acting to the detriment of front-line services which would be politically unpopular," he said.

The Office for Budget Responsibility has forecast 610,000 public sector jobs will be lost by 2016, assuming departmental spending cuts of 25%. Mr Philpott said 40% cuts would put more like one million jobs at risk.

Mr Philpott said the "big economic debate" was over whether cuts would affect jobs in parts of the private sector closely dependent on the public sector.

"If the government's right then we can have cuts in the public sector and actually have a growing economy and more jobs.

"If the government is wrong, then unemployment is likely to rise, and the ecomony, if not facing a double-dip recession, is at risk of very slow growth for a long time," he said.
Industrial action

Austerity measures imposed in Greece after its economy was bailed out by the European Union and International Monetary Fund have been met with violent protests and strikes.

Public sector workers in Spain have also been on strike in protest at pay cuts averaging 5%.

Mark Serwotka, general secretary of the UK's Public and Commercial Services union, said there was "no economic case to put people on the dole queue".

"We are already drawing up plans with other public sector unions to ensure that if the government attacks our pensions, our jobs and public services, they will face resistance the like of which we haven't seen in this country for decades," he said.

"We will see not just co-ordinated industrial action by unions but campaigns in every community."

Chancellor George Osborne used his first budget to impose a tough package of spending cuts and tax rises, including raising VAT from 17.5% to 20% next January.

Other measures included a two-year pay freeze for public sector workers earning over £21,000, a three-year freeze in child benefit, a cap on housing benefit and a reduction in tax credits for families earning more than £40,000.

Mr Osborne said decisive action was required, given the dire state of the public finances.
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[JimC]

Whichever way you cut it, the cuts are going to bite deeply. One hopes that they concentrate on cutting the areas that are wasteful and unecessary first...

Hope that no UK Ratz get hurt by this...

[Pensioner]

Whichever way you cut it, the cuts are going to bite deeply. One hopes that they concentrate on cutting the areas that are wasteful and unecessary first...

Hope that no UK Ratz get hurt by this...

Every last one of us are going to get hurt Jim no doubt about it.

[Rum]

I have probably said this before, but if they ditched Trident (our nuclear so called 'deterrent') it would solve the problem overnight.

[Horwood Beer-Master]

I've probably said this before, but if they cancelled all these PFI contracts, whereby private companies are paid more money to deliver worse services than if the government ran those services itself, we'd save shitloads of money, and the only people who'd lose out would be the executives/shareholders of the companies concerned.

[Feck]

This one is INSANE ...cutting housing benefit to £280 for a month .....The average rent for a flat in this city is over £400 .. Now if you are on JSA with an income of £65 week they just made you homeless ! and they are going to kick a lot of people back onto JSA the unemployment figures are going to rise even more than the recession is going to cause ......

I am going to invest in a cardboard box company they are going to be needed for the jobless homeless .

[Pensioner]

I've probably said this before, but if they cancelled all these PFI contracts, whereby private companies are paid more money to deliver worse services than if the government ran those services itself, we'd save shitloads of money, and the only people who'd lose out would be the executives/shareholders of the companies concerned.

I agree with you PFI contracts are bloody awful, expensive and deliver crap service to the end user, plus the workers have worse pay and conditions.

Rum I agree with you about Trident, it is logical madness to spend billions on weapons of mass destruction yet they can contemplate cutting welfare for the poorest in our country.

Cunts.

[Meekychuppet]

Personally I am a strange mix of optimistic and pragmatically worried. The cuts are going to hurt, no doubt, but at the same time I see big opportunities. In the worst case scenario I am an experienced graduate with a small mortgage, so work is not as hard to come by as it is for others. I am not afraid too get on my bike, as Tebbit suggested, either. We recycle and re-use everything in our house and we waste nothing so the house runs efficiently. We're also growing our own food so our grocery bills are low.

When it comes to work I am government funded to a large degree so that is a worry. One thing I think is that it would be far more difficult to get in to a depression than it was in the 1930s, mainly because of globalisation. The politicking and polarisation between powerful states just isn't there any more. The most extreme state then was Germany, a European military superpower, whereas now it's places such as Iran, who, even if they manage to build and detonate a nuclear bomb, will still have their clock cleaned. Given the circumstances I think the UK government could be far more Thatcherite than it is currently shaping up to be. In the 1980s there really was a 'fuck the North' attitude and I just don't see it this time. There seems to be a weird liberal strand to the Tories. I can't quite put my finger on it, but IDS's ideas about crime and rehabilitation are encouraging to say the least.

I also think that, right now at least, for anyone complaining about the job market, there is work. Sure, you might have to flip burgers but it beats the alternative. I'm not too proud to do it if crunch time comes. There seems to be genuine effort to assist those who wish to work and there is a sense of solidarity over here that I have never felt before. Having grown up in the North under the evil bitch herself, I was expecting far worse. f course, far worse may well arrive yet, there's at least 5 years of this before things turn around.

One thing I would like to know is who we owe this money to. Another thing I suspect is that these cuts may never happen. Another thing, slightly ironic too, is that I am entirely in agreement with Cameron's philosophy regarding public service and volunteerism. I am more than happy to volunteer for my area, I actually do so right now. It lets me get to know the people whose children I teach, and considering how well Burnley has regenerated, I am not prepared to let it go down the kazi. For the first time in my life I actually give a shit about England. Where I live the voters very kindly spanked the BNP out of contention and elected a Liberal Democrat whom I have a great deal of admiration for. This is England, and I am proud of the place.

If there is one thing I do know, and which my experience has taught me, it's that when they think you're finished, your finest hour is just around the corner.

[Rum]

-snip-

One thing I would like to know is who we owe this money to. Another thing I suspect is that these cuts may never happen. Another thing, slightly ironic too, is that I am entirely in agreement with Cameron's philosophy regarding public service and volunteerism. I am more than happy to volunteer for my area, I actually do so right now. It lets me get to know the people whose children I teach, and considering how well Burnley has regenerated, I am not prepared to let it go down the kazi. For the first time in my life I actually give a shit about England. Where I live the voters very kindly spanked the BNP out of contention and elected a Liberal Democrat whom I have a great deal of admiration for. This is England, and I am proud of the place.

If there is one thing I do know, and which my experience has taught me, it's that when they think you're finished, your finest hour is just around the corner.

No? Next week all 27 people who were employed on a project I set up three years ago are going to lose their jobs. They will happen alright.

[Pensioner]

-snip-

One thing I would like to know is who we owe this money to. Another thing I suspect is that these cuts may never happen. Another thing, slightly ironic too, is that I am entirely in agreement with Cameron's philosophy regarding public service and volunteerism. I am more than happy to volunteer for my area, I actually do so right now. It lets me get to know the people whose children I teach, and considering how well Burnley has regenerated, I am not prepared to let it go down the kazi. For the first time in my life I actually give a shit about England. Where I live the voters very kindly spanked the BNP out of contention and elected a Liberal Democrat whom I have a great deal of admiration for. This is England, and I am proud of the place.

If there is one thing I do know, and which my experience has taught me, it's that when they think you're finished, your finest hour is just around the corner.

No? Next week all 27 people who were employed on a project I set up three years ago are going to lose their jobs. They will happen alright.

I agree with you Rum but I hope we are wrong and Meeky is correct in his analysis, nothing would please me more. I would hate to say to Meeky I told you so in a few months time.

http://www.independent.co.uk/news/uk/po ... 17939.html

“Thousands of people could be forced to rely on food parcels because of benefit delays, as the Government's plan to slash the country's welfare bill is put into effect.
Charities that run foodbanks warned this weekend that the prospect of people having to rely on Third World-style food aid – despite Britain being among the richest nations in the world – is a real possibility for 1.5 million people who will be moved off incapacity benefit (IB).
The number of people who are turning to foodbanks as they can't afford to feed their families has soared, rising from 26,000 in 2008-09 to 41,000 in 2009-10 – 37 per cent of whom were referred to foodbanks because of delays with their benefits.”

[Meekychuppet]

No, you miss the point. There will be cuts for sure. What I mean that these are unusually un-Thatcheresque. I expected us to get far more of a hammering. It's not whether we'll get cuts, but whether we'll get THESE cuts.

[floppit]

It's odd really, I should be panicking but I can't see the point. My home has a large mortgage, my job is vulnerable - more so as I tend to stick my neck out, we rely on the NHS and there's a toddler here to be spewed into the state ed system before the tory rein is over. My take on it is to deal with each hurdle as it arises and try and lend a hand where I can.

The volunteer stuff could be good but it throws up really interesting questions in regard to the state's duties to the vulnerable. For example if there is a local religious counsellor could that tick a mental health box for an anti religion atheist? Also if a charity fails to fulfil the role it takes on is it the state of the charity held accountable, same goes for serious complaints re non professional (as opposed to illegal) behaviour, if they are non professionals then is there any complaint at all? As locally asking pubs if they wouldn't mind delivering meals for free to pensioners has been suggested some of the above issues might become very real - what if the waiter is unpleasantly rude to Mrs. Likestakealot? I'd suggest these things need ironing out prior, not post, using the voluntary sector for tasks we pay the state to undertake - for a start it'll be one hell of a harvest for volunteer religious organisations targeting the vulnerable.

[AshtonBlack]

PFIs. They were a good idea, not thought through.
The private companies who negotiated the contracts had bloody good contract lawyers. The government/council had Bob from accounting do their end. Result = Water tight contracts with a bias heavily in favour of the private sector. Government/Council fucked for the next 25 years.
I am one of the lucky ones, work in my sector is still on the up. (Not had a year when I've not had at least 5% rise in the last 6 years.)

[Brian Peacock]

Wankers!

(and that's my considered political opinion btw - you don't want to know what my ill-considered opinion is)

[Horwood Beer-Master]

...I also think that, right now at least, for anyone complaining about the job market, there is work. Sure, you might have to flip burgers but it beats the alternative...

I have to call you out on this one. There is a lazy assumption out there on the part of people who are safely in jobs that "even if there's nothing else, there's always the minimum wage stuff" - No there fucking isn't!!! Or at least insofar as there is, there are about a hundred applicants for each one.


Good luck finding yourself a "McJob" if you end-up unemployed Meeky. Might be harder than you think.