Orgy of cuts in Commons as Osborne wields the axe
British Chancellor George Osborne wielded his scythe with the savage exuberance of the Grim Reaper on the spree.
From the word “go” you knew he was not in the business of delivering silky, muted words designed to soften the blow. His statement, lasting a little over an hour, was hot and strong, and to some, unpalatable.
His first words jolted the Commons: “Today is the day when Britain gets back from the brink.” A few seconds later he warned that to back down now would mean “the road to economic ruin”.
Then he proceeded to announce savings of billions here, there and everywhere in public spending to restore, as he put it, “sanity” to the nation’s finances.
It cannot be said that this orgy of fiscal pruning came as much of a surprise since some of the cuts had been leaked, possibly deliberately, and others had been predicted through intelligent guesswork.
Osborne, with much finger-wagging, delivered his sentence on the nation – “we are all in this together” – in clipped, humourless and occasionally aggressive tones. There was much clearing of the throat and he took advantage of interruptions by taking swigs from his glass of water.
Sitting near him was Deputy Prime Minister Nick Clegg, nodding furiously like those toy dogs seen in the rear windows of cars. Clegg occasionally executed small bounces from his seat: whether this was through excitement or whether his nether garments were causing him problems remains unclear.
Needless to say, Osborne did not miss an opportunity to blame the last Labour government for everything that had gone wrong.
They were, he said, “all talk and no action” and were responsible for this “financial catastrophe”.
But amid all the carnage, the Chancellor found time to announce what sounded like hugely expensive improvements to the nation’s transport system and vowed that old people would still retain their free bus passes, free prescriptions, the winter fuel allowance and other benefits.
A cynic might point out that Osborne is only too well aware that this “grey” section of the population is growing fast and can also generally be relied upon to vote in large numbers.
His job, he said, was to cut waste and to reform a welfare system which could no longer be afforded. But he warned that it would take time “to turn round the debt super-tanker”.
Afterwards Alan Johnson, the shadow chancellor, responded in boisterous, barnstorming, robust style. If anyone knows how to rouse the rabble, it is Johnson.
He belaboured the Chancellor, quoting back at him Osborne’s own “contradictory” views of some years before. Ed Miliband, the Labour leader, looked on with the air of a proud man who felt he had picked the right person for the job.
Soon the House was in uproar, thanks to Johnson’s electrifying performance. This caused the over-sensitive Speaker John Bercow to complain about the noise.
What on earth did he expect on such a tumultuous day?
THE prison population will fall by about 3,000 over the next four years as the Ministry of Justice cuts its budget to £7.3 billion (€8.3bn).
“Radical change” will see the department’s resource budget cut by 23%, capital spending cut by 50% and its administration budget cut by a third as the MoJ makes average savings of 6% per year.
A total of £350m will be cut from the legal aid budget, which will involve “taking tough choices about the types of case that should receive public funding, and focusing support on those who need it most”, the Treasury said.
The prison population in England and Wales, which reached a record high of 85,495 on October 1, is one of the key targets in the spending review.
Reforms to the court system will also include the use of “mediation and alternatives to court where possible”, in a bid to provide “effective access to justice, while ensuring that court is seen as a last resort, rather than the default option”.
THE NHS budget will rise by 0.1% a year in real terms over the course of Parliament but key health promises have been abandoned or could be watered down.
Some pledges made by the previous Labour government have been scrapped, including expanding free prescription entitlements for people with long-term conditions.
One-to-one nursing for cancer patients and the promise that patients will only wait one week for cancer test results will also “not be taken forward at this stage”.
Before the election, Prime Minister David Cameron and Health Secretary Andrew Lansley promised a £200m-a-year fund for cancer drugs.
Yesterday’s review said the fund would be “up to” £200m (€227m) a year but no final decisions have been published.
Overall health spending will rise from £104 billion this year to £114bn by the end of the next four years.
The NHS is still expected to find “efficiency savings” of £15bn to £20bn.
UNIVERSITIES felt the full force of the cuts as it was announced teaching budgets would be slashed by £2.9 billion (€3.3bn). The move led to warnings that institutions could be forced to close.
The Treasury said the overall teaching budget for higher education, which excluded research funding, would be cut to £4.2bn from £7.1bn over the next four years. This was a £2.9bn cut, or 40%.
Teaching for science, technology, engineering and maths-based subjects would continue to be funded.
A new £150m National Scholarship Fund for poorer students would be established, the Chancellor confirmed.
Business Secretary Vince Cable said ministers were considering a new fee level of £7,000 per year – more than double the current £3,290.
Schools will see a small increase in funding, from £35bn to £39bn over four years.
GOVERNMENT funding for the police will be cut by a fifth in real terms over the next four years, the Treasury said.
Osborne told MPs police spending will fall by 4% each year of the spending settlement, with the aim of avoiding any reduction in the visibility and availability of police on the streets.
By 2014/15, the Home Office will reduce overall resource spending by 23% in real terms, and capital spending by 49%.
Home Secretary Theresa May said: “My absolute priority, as Home Secretary, is to ensure that the UK retains its capabilities to protect the public, secure the border and tackle the terrorist threat.
“We also have a responsibility to reduce the budget deficit and the Home Office must play its part in this.
“I believe that by improving efficiency, driving out waste, and increasing productivity we can maintain a strong police service, a secure border and effective counter-terrorism capabilities whilst delivering significant savings.”
THE Government dismayed millions of workers by announcing that people will have to work longer before they get their state pension.
Chancellor George Osborne said the state pension age for men and women will reach 66 by the year 2020 – four years sooner than previously expected.
He told MPs that this would involve a gradual rise in the state pension age from 65 to 66, starting in 2018. The move would save more than £5bn (€5.7bn) a year.
Meanwhile, withdrawing child benefit from higher-rate taxpayers is to hit 300,000 more families than the Government had claimed.
The move will also raise more than double the £1bn David Cameron and George Osborne said it would earlier this month.
But the removal of the benefit from higher rate taxpayers will affect 1.5 million families. The amount saved will be about £2.5bn.
HOUSING groups reacted angrily to government plans to bring social housing rents closer to private sector ones.
Rents for new tenants in the social housing sector are set to be increased to about 80% of the amount people would be charged in the private sector.
The money raised will be used to build 150,000 new affordable homes, while the move will only affect new tenants.
But the National Housing Federation, which represents English housing associations, warned that the change could lead to thousands of low income families having to pay up to £9,000 (almost €10,250) a year more in rent.
The group said the average rent for a three-bed social home is £85 a week, but that could triple to £250 a week.
It warned that as a result many new tenants were likely to be heavily dependent on housing benefit to cover the extra costs, which was likely to act as a “powerful disincentive” for people who were unemployed to get a job.
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