Lib Dem’s will preside over £47bn extra cuts

Green Politics

During the election, the Liberal Democrats supported Labour's fiscal consolidation plan. They now support £47 billion of additional spending cuts by 2015-16.

During the election, the Liberal Democrats supported Labour’s fiscal consolidation plan. In the Coalition Programme they changed tack and announced a desire instead to “significantly accelerate the reduction of the structural deficit”. Today we learned that this means an additional £47 billion in spending cuts by 2015-16.

In April, the Institute for Fiscal Studies produced a report on the plans of each of the three parties’ plans to repair the public finances. It said:

“The Liberal Democrat manifesto says that, in addition to delivering its tax plans, the party would set out spending plans this autumn to ‘at a minimum, halve the deficit by 2013–14’. On the face of it, this looks like adopting the less stringent of Labour’s two legislative targets and therefore seeking a less ambitious fiscal consolidation than that set out in Budget 2010. But the party has told us that this pledge should be seen as ‘shorthand’ for pursuing the same consolidation path as Labour.”

Table 1.1 of the Budget compares the policy inherited by the Government with the total discretionary consolidation. To criticism from some Keynesian economists for going too far, Labour had proposed “to more than halve the deficit over four years”. This mean £52 billion of spending cuts and £21 billion in tax increases by 2014-15. By 2015-16, the Coalition Government will have presided over an additional £47 billion in spending cuts and £8 billion in tax rises.


The graph above shows what this means in terms of tax (current receipts) and spend (total managed expenditure). The Coalition are clear that public spending should fall below 40 per cent for the first time since 2004. At least with the minor matter of an election out the way, we now know what the Lib Dems really think.

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9 Responses to “Lib Dem’s will preside over £47bn extra cuts”

  1. Ali Esbati

    RT @leftfootfwd: Lib Dem's will preside over £47bn extra cuts http://bit.ly/cEhd91

  2. Nadia

    RT @leftfootfwd: Lib Dem's will preside over £47bn extra cuts http://bit.ly/cEhd91

  3. Lib Dem’s will preside over £47bn extra cuts « The best Labour blogs

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  4. RedMantis

    So hurrah Neo Liberal Labour was only going to cut the Public Services by 52 Billion.

    What a bunch of gutless Tories you Labour Party members are.

    Not content with destroying the lives of 1000s in Iraq you want to try and suggest you are some how progressive on the economy

    The same “Labour” govt that had Myners, Digby “the workers friend” Jones, Lordy Mandelson of Mortgage and relaxed with Filfthy rich fame.
    Labour the gutless party of Property Magnate and Bush poodle Blair or Gordon the gormless, 70p for pensioners, 10p tax dbacle,taking money off the poor to give the wealthy Brown. Labour the Party of Purnells Workfare Program,harassment of asylum seekers,locking up asylum seekers kids, detention without trial, torture etc etc

    What a bunch of Murdoch worrying,privatising,anti union, hypocrites you are.
    Your about as progressive as a secondary metasasing cancer

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