This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.bbc.co.uk/news/uk-politics-23053693
The article has changed 15 times. There is an RSS feed of changes available.
Version 6 | Version 7 |
---|---|
Spending Review: Public sector staff to lose automatic pay rise | Spending Review: Public sector staff to lose automatic pay rise |
(35 minutes later) | |
Millions of public sector workers will lose automatic annual pay increases as part of an £11.5bn cuts package unveiled by Chancellor George Osborne. | |
He also announced a cap on total welfare spending and axed winter fuel payments for expatriate pensioners in hot countries from 2015. | |
And unemployed people will have to visit the job centre every week instead of fortnightly. | |
The cuts package will cover a single financial year - 2015/16. | |
It was forced on the chancellor by slower than expected economic growth and deficit reduction but he insisted the economy was on the right track, telling MPs: "Britain is moving out of intensive care and moving from rescue to recovery." | |
Tougher regime | |
He said the cuts, which will kick in shortly before the next general election, would ensure Britain "lives within its means" but they would be guided by fairness, growth and reform. | |
He announced that annual incremental pay increases in the civil service would be axed in 2015 and a fresh push to remove automatic pay rises for time served in NHS, prisons and police. The armed forces will be excluded from the changes. | |
He told MPs: "Progression pay can at best be described as antiquated; at worst, it's deeply unfair to other parts of the public sector who don't get it and to the private sector who have to pay for it." | |
Mr Osborne also announced a cap on the total amount the government spends on welfare each year, including housing benefit, disability benefit, tax credits and pensioner benefits - but excluding the state pension. | |
Governments breaching the cap would be censured by the Office for Budget Responsibility and have to explain their actions to Parliament. | |
He also axed winter fuel payments for expatriate pensioners living in warm countries, saying the benefit would be linked to a "temperature test" from 2015. | |
And he announced a tougher regime for job seekers, saying they will have to visit the JobCentre every week to spend more time with advisors. There will also be a seven day wait before people can claim benefits. | |
"Those first few days should be spent looking for work, not looking to sign on," said Mr Osborne. | |
"We're doing these things because we know they help people stay off benefits and help those on benefits get back into work faster." | |
In a further change, claimants who cannot speak English "will have to attend language courses until they do". | |
Biggest winners | |
He also warned of further job cuts in the public sector. | |
Mr Osborne confirmed that the health service, schools in England and foreign aid would continue to be protected from budget cuts. | |
But that means all other departments will have to take a bigger hit, with average budget cuts for 2015/16 of between 8% and 10%. | |
The Department for Communities and Local Government, the Treasury and the Department for the Environment and Rural Affairs appear to have taken the biggest hits, with budget cuts for 2015/16 of 10%. The Department for Work and Pensions will have to save 9.5% in its running costs. | |
Theresa May's Home Office escaped with cuts of 6% and a commitment to protect anti-terror policing. | Theresa May's Home Office escaped with cuts of 6% and a commitment to protect anti-terror policing. |
Vince Cable's business department - the last to reach a deal with Mr Osborne after tough negotiations - also got off relatively lightly with cuts of 6% and a commitment to keep money for more apprenticeships, but student grants will be frozen. | Vince Cable's business department - the last to reach a deal with Mr Osborne after tough negotiations - also got off relatively lightly with cuts of 6% and a commitment to keep money for more apprenticeships, but student grants will be frozen. |
The culture department also escaped the worst of the cuts, with a reduction of 7%, while the Foreign Office will be cut by 8%. | The culture department also escaped the worst of the cuts, with a reduction of 7%, while the Foreign Office will be cut by 8%. |
The security services were the biggest winners, with a 3.4% boost to funding, with Mr Osborne praising their "heroic" efforts to "protect us and our way of life". | The security services were the biggest winners, with a 3.4% boost to funding, with Mr Osborne praising their "heroic" efforts to "protect us and our way of life". |
The chancellor also announced long-term plans to invest more in Britain's infrastructure in building roads, railways and housing, with full details to follow on Thursday. | The chancellor also announced long-term plans to invest more in Britain's infrastructure in building roads, railways and housing, with full details to follow on Thursday. |
The next general election is scheduled for May 2015 and the Conservative-Liberal Democrat coalition has to set out its budgetary plans for the final few weeks of its time in office, irrespective of the outcome of the poll. | The next general election is scheduled for May 2015 and the Conservative-Liberal Democrat coalition has to set out its budgetary plans for the final few weeks of its time in office, irrespective of the outcome of the poll. |
Labour has said that it would match the coalition's current spending totals for the full one-year period. | Labour has said that it would match the coalition's current spending totals for the full one-year period. |
The chancellor had initially hoped to eliminate the structural deficit - the portion of borrowing that is not affected by changes in the economic cycle - entirely by 2014-15. | The chancellor had initially hoped to eliminate the structural deficit - the portion of borrowing that is not affected by changes in the economic cycle - entirely by 2014-15. |
But the timeframe for this has slipped to 2017-18 and Mr Osborne will have to borrow £275bn more than he expected in this parliament than at the time of his first Budget in 2010. | But the timeframe for this has slipped to 2017-18 and Mr Osborne will have to borrow £275bn more than he expected in this parliament than at the time of his first Budget in 2010. |
The government says it has cut overall borrowing by a quarter since coming to power and by a third as a share of GDP. | The government says it has cut overall borrowing by a quarter since coming to power and by a third as a share of GDP. |
Revised official figures released on Friday showed that borrowing rose slightly to £118.8bn in 2012-13 from £118.5bn the year before. | Revised official figures released on Friday showed that borrowing rose slightly to £118.8bn in 2012-13 from £118.5bn the year before. |
Labour leader Ed Miliband said the coalition had broken its promise to clear the deficit and the British people were paying the price for its failure. | Labour leader Ed Miliband said the coalition had broken its promise to clear the deficit and the British people were paying the price for its failure. |
Speaking ahead of the chancellor's statement, he said: "They tell us the economy is healing in government but actually things are getting worse for ordinary families. What we actually need is a fairer plan to get growth moving, living standards rising and the deficit down." | Speaking ahead of the chancellor's statement, he said: "They tell us the economy is healing in government but actually things are getting worse for ordinary families. What we actually need is a fairer plan to get growth moving, living standards rising and the deficit down." |