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Autumn Statement: Osborne to make fresh spending cuts Autumn Statement: Osborne to make fresh spending cuts
(about 4 hours later)
George Osborne will announce a fresh round of spending cuts for Whitehall departments when he gives his Autumn Statement on Thursday.George Osborne will announce a fresh round of spending cuts for Whitehall departments when he gives his Autumn Statement on Thursday.
The chancellor has written to cabinet colleagues to say budgets will face total extra reductions of £1bn a year for the next three financial years.The chancellor has written to cabinet colleagues to say budgets will face total extra reductions of £1bn a year for the next three financial years.
The first £1bn will come mainly from unspent reserves, he will say.The first £1bn will come mainly from unspent reserves, he will say.
Health, schools, foreign aid, local government, revenue and customs and the security services will be protected.Health, schools, foreign aid, local government, revenue and customs and the security services will be protected.
Treasury officials said that, although financial discipline and efficiency savings would play their part, departments would have to find cuts of 1.1% in 2014/15 and 2015/16.Treasury officials said that, although financial discipline and efficiency savings would play their part, departments would have to find cuts of 1.1% in 2014/15 and 2015/16.
The Ministry of Defence will have some flexibility to protect any underspent budgets. So the biggest losers in Whitehall will be those such as the Department for Work and Pensions, the Department for Business, Innovation and Skills, the Home Office and the Ministry of Justice.The Ministry of Defence will have some flexibility to protect any underspent budgets. So the biggest losers in Whitehall will be those such as the Department for Work and Pensions, the Department for Business, Innovation and Skills, the Home Office and the Ministry of Justice.
Officials refused to say what the savings would be used for, but the government does have to find money to pay for recent commitments such as marriage tax breaks, more free school meals and potentially any fuel duty freeze the chancellor may announce.Officials refused to say what the savings would be used for, but the government does have to find money to pay for recent commitments such as marriage tax breaks, more free school meals and potentially any fuel duty freeze the chancellor may announce.
Officials said the tough decisions showed that this would be a responsible recovery and there would be no giveaways while the government completed its long term plan to fix the economy.Officials said the tough decisions showed that this would be a responsible recovery and there would be no giveaways while the government completed its long term plan to fix the economy.
Some of the details of Mr Osborne's statement have already been announced, including:Some of the details of Mr Osborne's statement have already been announced, including:
The BBC has also learned that the chancellor will cap business rate increases in England and Wales to 2% next year, rather than the rate of inflation, in an effort to boost firms and High Streets.The BBC has also learned that the chancellor will cap business rate increases in England and Wales to 2% next year, rather than the rate of inflation, in an effort to boost firms and High Streets.
In the House of Commons, Deputy Speaker Dawn Primarolo said Mr Osborne would be "mortified" that details of his statement had been reported ahead of Thursday.
This followed Conservative MP Peter Bone saying: "This is not the first leak… and the chancellor must be mortified and I wonder if he is coming to announce a leak inquiry".
Ms Primarolo said she had not seen media reports about the statement but she was "sure he's correct that the chancellor will be mortified".
She added: "The Speaker has made it absolutely clear that any government announcement should be made first to this House."