Congress to cut $30 billion from US budget

THE Republican led US Congress is to cut nearly $30 billion (£19.2 billion) from US federal spending this year by putting the government on a short leash and trimming hundreds of federal programmes.

And the process is likely to goon whether or not Congress and Democratic President Bill Clinton reach agreement on a balanced budget.

The squeeze is centred on a small part of the federal budget where Congress has the most leverage the 17 per cent devoted to non defence annual spending. Many of the programmes targeted for cuts this year were those prized by Democrats and President Clinton such as the Environmental Protection Agency, federal support for the arts and youth services.

These annual spending bills have been cut by $23 billion and the delays in approving a full year budget could bring an additional $7 billion in savings by the time the fiscal year ends on September 30th, according to House Appropriations Committee chairman Mr Bob Livingston.

"The administration is beginning to understand we have the power of the purse on the discretionary budget," Mr Livingston said.

Congress has forced the government to operate at reduced levels since the new fiscal year started on October 1st. With two shutdowns one lasting three weeks over the Christmas holiday and a series of short term spending bills, agencies have been spending money much more slowly than usual.

"We can confidently say our fiscal year 1996 bills save at least $30 billion," Mr Livingston wrote in a letter to Republican colleagues as they prepared to return to their districts in February having not reached a budget deal with Mr Clinton.

"We will squeeze the Democrats so that they will have to come to the table," Mr Livingston said. Spending levels for most programmes would remain at the lowest level approved by either the House or Senate.