PUBLIC SPENDING in the United Kingdom is to be sharply curbed, leading to the loss of half a million public sector job losses – 30,000 of them in Northern Ireland – following chancellor of the exchequer George Osborne’s plan to eliminate the deficit.
It is the toughest action taken by a government since the UK was forced to seek International Monetary Fund assistance in 1976.
Billions are to be cut from local authorities, and government departments, while welfare benefits will be cut by an additional £7 billion (€7.95 billion) by 2014–15, in addition to the £11 billion announced in June. This will be done through higher rents for new local authority tenants and unemployment benefit cuts. Child-benefit reductions will save £2.5 billion, almost 2½ times the amount Mr Osborne predicted when he announced the move this month.
Mr Osborne’s decisions sparked a political row last night in the North after First Minister Peter Robinson and Deputy First Minister Martin McGuinness accused him of “bad faith”.
Mr Robinson and Mr McGuinness said they were dismayed by the cuts, particularly the 36 per cent reduction in capital spending.
However, Northern Secretary Owen Paterson said the North had been given a “remarkable deal”, adding that both men were “pleasantly relieved” when he briefed them about the plan before yesterday’s announcement.
Up to 30,000 public sector jobs could be lost in Northern Ireland by Mr Osborne’s decisions, which will cut £4 billion (€4.54 billion) from the Executive’s budget – though he claimed in the House of Commons that it would get a cash rise, albeit one below inflation.
Minister for Finance Sammy Wilson is to co-ordinate the Executive’s formal response to the chancellor’s moves when it meets tomorrow.
Union leaders condemned Mr Osborne’s actions, saying the treasury’s figures showed that the poorest 10 per cent in society will be the second-biggest losers.