Chief reporter
Chancellor of the Exchequer George Osborne has announced plans for cutting £6.2bn from the UK’s deficit – spelling out measures for ‘efficiency gains’ across all government departments and the abolition of certain quangos.
This is the coalition government’s first move to tackle the UK’s deficit, which reached £159.2bn last year according to the Office for National Statistics. The department reported this was equivalent to 11.4 per cent of the country’s gross domestic product (GDP).
When announcing the creation of an independent Office for Budget Responsibility (OBR) last week Osborne warned that failure to tackle the UK’s record deficit would be ’disastrous’. He said these savings were achievable without affecting frontline public services and will be an immediate down payment towards reducing the deficit.
Osborne devised plans for efficiency gains with his Liberal Democrat colleague the Chief Secretary to the Treasury, David Laws. The secretary stood with the chancellor today as he announced these measures will likely take the form of budget cuts for IT, consultancy, advertising and a civil servant recruitment freeze.
The predicted £6.2bn savings includes cuts across nearly all departments including £836m from Business, £683m from Transport and £670m from Education.
Laws said the savings figure do not take into account the departments of Health, International Development and Defence, which will need to make their own separate budgeting decisions.
Osborne and Laws see nearly £600m being saved by slashing costs from quangos or possibly abolishing some. While there is still speculation as to which quango will be sent to the chopping block, Laws did confirm major cuts will be made to the Train to Gain scheme as it was considered to have low value for money.
Whilst this is a step in the right direction there are far greater cuts out there that would assist in turning this countries finance around. Over the last few years we have heard nothing but talk about resolving the disparity between the private and public sector pensions. I like many people feel extremely bitter about this situation knowing what hardships many private sector workers have had to and continue to endure over the last 18 months. All of the employees at my company took a 10% pay cut last year as well as many redundancies and the loss of our final salary scheme. The Public sector should come into the real world and the changes should be done immediately with no phasing in over many years which I feel is likely to be the case if anyone is brave enough to tackle this issue.
I feel the comment regarding the Train to Gain being low value for money as an unfair statement. I spent an enourmous amount of time ensuring we had the right College supporting us and the right person delivering the course, based on the NSAM project based, NVQ at level 2 and 3.
As a company we have had great success implementing lean techniques and processes and improved our overall knowledge in leaner manufacturing, from supervision to shopfloor operatives.
The funding seems to have been used up by training providers, although the training and delivery was low value in a lot of cases but not all.
It’s amazing how the private sector jumps in on the public sector as the animal that needs a cull. The public sector, pay, pensions, benefits and expenses have lagged behind the private sector for years. Is the idea because you cant have it others shouldn’t.
We shouldn’t forget who got us into the mess we are in the private sector.
On public sector cuts its time to have a look at the welfare state, how can it be right that you can get payed more than the minimum wage for doing nothing, accumulative benefits should be trimmed back to 75% of minimum wage to encourage people off benefits.
Finally when you do receive benefits it should be a given you have to do your 40 hours per week, volunteering and the like.
As Engineers we should appreciate and always consider that everything is relative, so I looked up how other countries fair.. see below.
If you listen to the new government, who appear to be acting as consultants and telling you the obivious and politically making it sound as if the Labour Government intentionally set out to create the deficit and that they will reduce it to save the nation, you would think the UK is alone. Far from it.
Look at the list and see that countries with higher %deficit than UK, include Germany, France, Canada, Singapore, etc, etc. and those with lower deficits include Bangledesh, Angola, Korea, Ethopia.
The key for governmnets is a balancing act between expenditure, services, jobs, development.
Thus whilst we are supported to be in this all together, it looks like the cuts will be at the expense of JOB cuts. Savings are cuts which affect services and job reductions.
It is easy to cut and delete, much harder to create and develop.
Other selected Levels of Public Debt as a % of GDP from 2009 est
1 Zimbabwe 304.30 %
2 Japan 192.10
3 Saint Kitts and Nevis 185.00
4 Lebanon 160.10
5 Jamaica 131.70
6 Singapore 117.60
7 Italy 115.20
8 Greece 108.10
9 Sudan 104.50
10 Iceland 100.60
11 Belgium 99.00
12 Nicaragua 87.00
13 Israel 83.90
14 Sri Lanka 82.90
15 Egypt 79.80
16 France 79.70
17 Germany 77.20
18 Portugal 75.20
19 Hungary 72.40
20 Canada 72.30
21 Jordan 69.90
22 United Kingdom 68.50
23 Austria 68.20
24 Ghana 67.50
25 Malta 66.20
26 Cote d’Ivoire 63.80
27 Ireland 63.70
28 Netherlands 62.30
29 Philippines 62.30
30 Norway 60.20
31 India 60.10
32 Spain 59.50
33 Uruguay 58.70
34 Mauritius 58.30
35 Malawi 58.00
36 Bhutan 57.80
37 El Salvador 55.40
38 Albania 54.90
39 Kenya 54.10
40 Morocco 54.10
41 Tunisia 53.80
42 World 53.60
43 Cyprus 52.40
44 Vietnam 52.30
45 Panama 49.50
46 Thailand 49.40
47 Costa Rica 49.30
48 Argentina 49.10
49 Turkey 48.50
50 Malaysia 47.80
51 Croatia 47.70
52 Poland 47.50
53 United Arab Emirates 47.20
54 Brazil 46.80
55 Finland 46.60
56 Aruba 46.30
57 Colombia 46.10
58 Pakistan 45.30
59 Bolivia 44.00
60 Seychelles 43.90
61 Switzerland 43.50
62 Sweden 43.20
63 Bosnia and Herzegovina 43.00
64 Mexico 42.60
65 Dominican Republic 41.50
66 United States 39.70
67 Yemen 39.60
68 Bangladesh 38.20
69 Denmark 38.10
70 Montenegro 38.00
71 Serbia 37.00
72 South Africa 35.70
73 Cuba 34.80
74 Gabon 34.70
75 Slovakia 34.60
76 Taiwan 34.60
77 Papua New Guinea 33.70
78 Czech Republic 32.80
79 Guatemala 32.70
80 Latvia 32.50
81 Ecuador 32.30
82 Syria 32.30
83 Ethiopia 31.70
84 Zambia 31.50
85 Slovenia 31.40
86 Lithuania 31.30
87 Moldova 31.30
88 Bahrain 30.10
89 Indonesia 29.80
90 New Zealand 29.30
91 Korea, South 28.00
92 Trinidad and Tobago 26.70
93 Mozambique 26.10
94 Peru 26.10
95 Tanzania 24.80
96 Macedonia 24.50
97 Honduras 24.30
98 Senegal 24.00
99 Paraguay 22.10
100 Bulgaria 21.40
101 Ukraine 20.70
102 Saudi Arabia 20.30
103 Romania 20.00
104 Iran 19.40
105 Venezuela 19.40
106 Uganda 19.30
107 Namibia 19.10
108 Australia 18.60
109 China 18.20
110 Hong Kong 18.10
111 Botswana 17.90
112 Nigeria 17.80
113 Angola 16.80
114 Gibraltar 15.70
115 Luxembourg 14.50
116 Cameroon 14.30
117 Kazakhstan 14.00
118 Uzbekistan 11.70
119 Algeria 10.70
120 Chile 9.00
121 Kuwait 8.20
122 Estonia 7.50
123 Qatar 7.10
124 Russia 6.90
125 Libya 6.50
126 Wallis and Futuna 5.60
127 Azerbaijan 4.60
128 Oman 2.80
129 Equatorial Guinea 1.10
1/2 pay for all state employees,pensioners and benefit claimants with alternating months on full pay next one on 1/2 pay etc.
No aid until we have a surplus as it is bonkers to borrow cash to give it away and not done by sensible people with thier own cash.(Even if the bank would lend them the cash to give away).
With reference to the Anonymous poster who talks about benefits and pensions in the public sector lagging behind the private sector. This may have been the case in the past but it is certainly not now.
Blaming the private sector is an excuse that Public sector workers use instead of looking at the real problem – Public Sector Spending.
I do not believe that there should be job losses but instead, the public sector needs to be more efficient.
It needs to happen fast and they will have to deal with it as we have been doing in the private sector for the last 2 years.
They should look at it as a good opportunity – the private sector used the last 2 years to make some great changes. Many companies managed to get rid of a lot of dead wood, changed spending habits and put some efficient systems in. The ones that survived are much stronger for it.
George your idea is ridiculous. As a public sector worker I could not live on half pay, that would not even cover rent, council tax and bills let alone paying for open university studies.
If you look at manufacturing which has been hit time after time, after in my case taking pay cuts, 4 day weeks to save money plus unprotected pensions the public sector has to do something. i for one am fed up paying for my own rubbish pension, waiting for frozen ones to disappear into nothing whilst subsdising the public sector final salary schemes, this has to stop