Cut! Cut! Cut!

Osborne tells ministers to find 40% savings Police and transport among worst hit NHS, schools and aid stay ring-fenced

POLICE, councils and transport could face deep cuts over the next five years as George Osborne has told ministers to draw up plans for savings of up to 40 per cent.

Launching his spending review, the Chancellor demanded a further £20billion of cuts to Whitehall budgets by the end of this Parliament.

He told MPs that so-called ‘unprotected’ departments would have to come up with two savings plans, one for a 25 per cent cutback in spending by 2020 and the other for 40 per cent.

Only the NHS, schools, foreign aid and defence will not have to come up with further savings.

Mr Osborne told Cabinet ministers they would be expected to deliver ‘more for less’. It means that large departments such as the Home Office, which is in charge of policing, and the Department of Transport will have to find enormous savings. Councils will also have to impose more cuts.

The final decision for where the cuts will fall will not be made until the autumn. Even though departments are being asked to model the 40 per cent savings scenario, it is unlikely cuts will be of that magnitude.

The Institute for Fiscal Studies estimates that unprotected departments will need to save around 13 per cent to meet the £20billion target.

Giving evidence to the Commons Treasury Committee, Mr Osborne acknowledged that ring- fencing spending on defence, schools, the NHS and international aid would mean deeper cuts elsewhere.

‘It is right for a Government to make a judgment about its priorities,’ he said. ‘We have made those commitments.

‘ That obviously increases pressures elsewhere in government. But government is ultimately about making these choices. I think we have made the right choices.’ As part of the efficiency drive, the Chancellor has signalled that he wants departments to draw up plans to sell off billions of pounds worth of land and other public sector assets.

A document setting out the scope of the spending review, which will report on November

‘We can get more for less’

25, confirmed additional investment in defence. But officials pointed out that the Ministry of Defence alone currently owns around 1 per cent of land in the UK – some 227,300 hectares.

Altogether, despite £1.7billionworth of disposals in the last parliament, the Government still owns more than £300billionworth of land and buildings.

Mr Osborne said the further savings – which follow the £12billion in welfare cuts and £5billion from tackling tax avoidance announced in the Budget – will complete the Conservatives’ plan to eliminate the deficit in public finances.

‘We have shown with careful management of public money we can get more for less and give working people real control over the decisions that affect them and their communities,’ he told MPs at Treasury Questions.

For Labour, shadow chancellor Chris Leslie said Mr Osborne had no plan for ‘sensible savings’ to public services.

‘Departments are not being given a clear sense from the Treasury of what to plan for in the spending review, particularly since we’ve seen three sets of spending plans in the last few months,’ he said.

‘Britain’s public services need a coherent plan to balance the books and put productivity first, not a Chancellor who chops and changes from month to month.’ ÷ The Treasury has enjoyed a record tax take for the first three months of a financial year, Office for National Statistics figures showed yesterday.

The total tax income for April to June was £147.5billion, up 5.4 per cent on a year earlier and the biggest haul for that period on record.

The soaring tax receipts have pushed government borrowing down to the lowest level since before the financial crisis.

Quentin Letts – Page 16