Saturday, 3 July 2010

Treasury: prepare for 40% cuts

The Observer has this report:

'Cabinet ministers have been ordered by the Treasury to plan for unprecedented cuts of 40% in their departmental budgets as the coalition widens the scope of its four-year austerity drive.

The eye-watering demand from the chief secretary to the Treasury, Danny Alexander, was sent this weekend to cabinet colleagues ahead of a week in which ministers will step up emergency cost-cutting across the public sector.

The only departments not included in the Treasury trawl will be health and international development, which have been "ringfenced" for the current parliament. Education and defence will also escape lightly. Alexander has told the education secretary, Michael Gove, and the defence secretary, Liam Fox, to plan for two scenarios – cuts to budgets of 10% at best and 20% at worst over four years.

All other departments – including the Home Office, the Department for Work and Pensions and the Department for Transport – have been ordered to produce plans showing the impact of cuts of 25%, and at worst 40%.'

See also:
Budget: poorest tenth to suffer over 20% cut in income
Impact of cuts: 1.3 million jobs to go

Picture: Lib Dem Danny Alexander is right behind George Osborne


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