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Labour cuts 'tougher than 1980s' Labour cuts 'tougher than 1980s'
(about 2 hours later)
Alistair Darling has conceded that if Labour is re-elected public spending cuts will be "tougher and deeper" than those implemented by Margaret Thatcher.Alistair Darling has conceded that if Labour is re-elected public spending cuts will be "tougher and deeper" than those implemented by Margaret Thatcher.
Asked in a BBC interview to spell out how far-reaching future cuts could be, Mr Darling did not reject a comparison with measures taken in the early 1980s.Asked in a BBC interview to spell out how far-reaching future cuts could be, Mr Darling did not reject a comparison with measures taken in the early 1980s.
The Tories have said they would cut even more from spending than Labour.The Tories have said they would cut even more from spending than Labour.
Opposition parties say Mr Darling "ducked" the issue in his Budget speech ahead of the election campaign. Shadow chancellor George Osborne said the comments had "blown apart" Labour's claims that it could "go on spending".
Experts say Mr Darling has postponed the major decisions on departmental spending, and what is widely expected to be substantial cuts in many areas, to a spending review expected in the autumn.Experts say Mr Darling has postponed the major decisions on departmental spending, and what is widely expected to be substantial cuts in many areas, to a spending review expected in the autumn.
The chancellor warned in his Budget speech that this review would be the "toughest in decades".The chancellor warned in his Budget speech that this review would be the "toughest in decades".
'Non-negotiable''Non-negotiable'
Asked by the BBC's Political Editor Nick Robinson to accept the Treasury's own figures suggest deeper, tougher cuts than those implemented by the Thatcher government in the 1980s, Mr Darling replied: "They will be deeper and tougher - where we make the precise comparison I think is secondary to fact is an acknowledgement that these reductions will be tough".Asked by the BBC's Political Editor Nick Robinson to accept the Treasury's own figures suggest deeper, tougher cuts than those implemented by the Thatcher government in the 1980s, Mr Darling replied: "They will be deeper and tougher - where we make the precise comparison I think is secondary to fact is an acknowledgement that these reductions will be tough".
There may be things that we don't do, that we cut in the future Alistair Darling
He added: "There may be things that we don't do, that we cut in the future. We will have to decide what precisely we can do within the [spending] envelope I set."He added: "There may be things that we don't do, that we cut in the future. We will have to decide what precisely we can do within the [spending] envelope I set."
"What is non-negotiable is that borrowing is coming down by half over a four-year period.""What is non-negotiable is that borrowing is coming down by half over a four-year period."
There may be things that we don't do, that we cut in the future Alistair Darling
The Institute for Fiscal Studies, an independent think tank, has noted that total public spending increased by an average of 1.1% a year in real terms over the Thatcher era, at a time when inflation was higher than it is today.The Institute for Fiscal Studies, an independent think tank, has noted that total public spending increased by an average of 1.1% a year in real terms over the Thatcher era, at a time when inflation was higher than it is today.
This is almost three times the increase of 0.4% a year that Mr Darling has pencilled in for the next Parliament.This is almost three times the increase of 0.4% a year that Mr Darling has pencilled in for the next Parliament.
The IFS went on to observe that "if we subtract spending on welfare and debt interest then we estimate that the rest of public spending would be cut in real terms by an average of 1.4% a year compared to an average increase of 0.7% in the Thatcher era. We have not seen five years with an average annual real cut as big as this since the mid-1970s".The IFS went on to observe that "if we subtract spending on welfare and debt interest then we estimate that the rest of public spending would be cut in real terms by an average of 1.4% a year compared to an average increase of 0.7% in the Thatcher era. We have not seen five years with an average annual real cut as big as this since the mid-1970s".
As the Conservatives wish to make bigger spending cuts than Labour they have already accepted that they would have to be tougher than Margaret Thatcher.As the Conservatives wish to make bigger spending cuts than Labour they have already accepted that they would have to be tougher than Margaret Thatcher.
Budget falloutBudget fallout
On a day in which the election battle lines were drawn up around the economy, Shadow chancellor George Osborne attacked Labour for an "empty" Budget and lack of "vision" on tackling the deficit. On a day in which the election battle lines were drawn up around the economy, shadow chancellor George Osborne said: "Gordon Brown is basing his election campaign on the claim that Labour can go on spending. That is completely blown apart by Alistair Darling's admission, under pressure, that Labour's own Budget numbers imply deep cuts."
"But why didn't he admit that yesterday? Twenty-four hours on, this empty Budget has completely unravelled and Labour's failure to act will hit families hard."
Mr Osborne said the Conservatives would set out further details of how they would cut Britain's deficit at a faster rate than Labour before the general election, adding that they would place more emphasis on spending cuts than tax rises.Mr Osborne said the Conservatives would set out further details of how they would cut Britain's deficit at a faster rate than Labour before the general election, adding that they would place more emphasis on spending cuts than tax rises.
The Liberal Democrats say Labour and the Tories are both "in denial" about the scale of spending cuts needed.
BUDGET 2010: AT-A-GLANCE Deficit not as big as predicted First time buyers stamp duty cut Planned petrol duty rise staggered 20,000 university places pledged Force state banks to lend moreCrackdown on tax evasion Tax hike on strong cider Growth package to boost jobs Bank accounts for all citizensGreen investment fund The Full Story: Budget 2010 At-a-glance: The key pointsBUDGET 2010: AT-A-GLANCE Deficit not as big as predicted First time buyers stamp duty cut Planned petrol duty rise staggered 20,000 university places pledged Force state banks to lend moreCrackdown on tax evasion Tax hike on strong cider Growth package to boost jobs Bank accounts for all citizensGreen investment fund The Full Story: Budget 2010 At-a-glance: The key points
Lib Dem leader Nick Clegg said the government was being "utterly dishonest".
"Yesterday we had a Budget in complete denial about the difficult decisions ahead. Today AD frightens people up and down the country by saying the cuts are going to be even worse than under Margaret Thatcher."
In his Budget speech, Mr Darling said Labour had been "right about the recovery" and urged voters not to put it at risk by deserting the party.In his Budget speech, Mr Darling said Labour had been "right about the recovery" and urged voters not to put it at risk by deserting the party.
He told the BBC that he believed the Budget speech would provide a "very good foundation on which to build" as Labour attempt to seek a fourth term in government.He told the BBC that he believed the Budget speech would provide a "very good foundation on which to build" as Labour attempt to seek a fourth term in government.
If the Conservatives win power at the election they have said they would introduce an "emergency" Budget within 50 days, which would overturn many of Mr Darling's policies.If the Conservatives win power at the election they have said they would introduce an "emergency" Budget within 50 days, which would overturn many of Mr Darling's policies.
Britain's budget deficit remains at a record high but it is £11bn lower than the £178bn forecast by Mr Darling in his pre-Budget report thanks to better than expected tax receipts over the past three months.Britain's budget deficit remains at a record high but it is £11bn lower than the £178bn forecast by Mr Darling in his pre-Budget report thanks to better than expected tax receipts over the past three months.