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The story only starts here...

Nick Robinson | 16:55 UK time, Wednesday, 20 October 2010

Today the chancellor delivered what is only the opening line of what is set to be a long-running political saga.

George Osborne in car leaving Parliament

 

George Osborne set out the story that he is hoping to see unfold - the deficit tamed then eliminated, welfare reformed, waste cut but spending on the NHS, schools, big transport infrastructure projects and overseas aid all protected.

Those who work in the public sector will get paid less and have to pay more for their pension - if, of course, they keep their jobs. And, since we are "all in it together", we will all have to work longer before being entitled to a state pension.

It is not the government, however, which writes the whole of this story.

The next chapter is likely to examine the consequences of unprecedented cuts in welfare spending. The headline saving - £18bn in total - is, remember, the equivalent of 18 million households losing £1,000 each. A significant number of people who now depend on housing benefit, council tax benefit, tax credits and what used to be called "sickness" benefit will receive significantly less or stop receiving benefits altogether.

Turn a page or two and we'll find out which jobs and services councils have to cut to save around a quarter of their budgets.

Keep flicking forward and we'll see how long the relief felt in schools and hospitals lasts given what is still the tightest settlement for them in many, many years.

None of this will determine how this saga ends - that will depend on whether the economy grows enough to absorb the cuts and the consequent job losses or whether it stalls, leaving people to dwell on what many will, undoubtedly, see as the unfairness of it all.

The chancellor's speech suggested a title for the work he began today - "Back from the Brink". He knows that if he's got this wrong he will be accused of pushing Britain "Over the Precipice".

Comments

Page 1 of 2

  • Comment number 1.

    At last we have real political leadership & a Government with a vision, how long have we waited for that?

  • Comment number 2.

    Nick - we're back to Tina.
    Does anyone imagine that the financial markets would have tolerated a do-nothing approach to expenditure earlier this year when Eurozone was in crisis? We're still waiting for Labour to spell out in detail what they would be doing had they been in office.

    These are balanced judgements but given the views of the Bank of England, IMF, CBI etc the government appears to have taken the right course for the right reasons.

  • Comment number 3.

    Nick, I listened to you on BBC2. Please, please do your research and get your terms right. It is not "Education Support Allowance" that the Government is restricting to one year, it is "Employment Support Allowance" ESA. See here: http://www.dwp.gov.uk/employment-and-support/ Please tell your colleagues as they are getting it wrong too.

    Thank you darling.

  • Comment number 4.

    The question is whether the measures will have the result intended so far as employment is concerned.
    If there are job opportunities in the private sector it seems likely they will be taken by people from other EU countries, such as the Poles who are prepared to work hard for low wages. So restrictions on immigration will have minimal affect.
    And the EU wants to cancel our rebate so it can continue funding the French farmers!

  • Comment number 5.

    The really nasty cuts are the reductions in Housing benefit which are aimed at ethnically cleansing the Center of London of poor people. Also the changes in eligibility criteria will result in old people and people with disabilities having services withdrawn.

    Shame on the Conservatives the nasty party has returned

  • Comment number 6.

    doh @ prior 40

    Well, yes. I do rate Johnson - and I think he'll get on top of this brief - but it's true that Balls and Coop have more relevant expertise. I'd prefer one of them in the job. Still, perhaps AJ is just keeping the seat warm for David Miliband - quite a thought.

  • Comment number 7.

    oh well, saga, if you insist...



    When Britain first, at heaven's command,
    Arose from out the azure main,
    Arose, arose, arose from out the a-azure main,
    This was the charter, the charter of the land,
    And guardian angels sang this strain:

    (ALL TOGETHER NOW)

    Rule Britania!
    Britannia rule the waves.
    Britons never, never, never shall be slaves.

    (LOUDER)

    Rule Britannia!
    Britannia rule the waves.
    Britons never, never, never shall be slaves.

    (REPEAT AT TOP VOLUME UNTIL HOARSE WHILST WAVING UNION FLAG)

    http://www.cs.bath.ac.uk/tom/skuki/images/Flag_of_the_United_Kingdom.png






    FTSE closed up 25.09

  • Comment number 8.

    "Everyone can have a job; it's just a question of whether you are prepared to go back into domestic service or not."


    I need a good swimming pool cleaner, if anyone's interested.




    I'm joking, of course. Pool's closed down for the winter now and anyway, I find it therapeutic to clean the pool on a sunny evening.

  • Comment number 9.

    44. At 4:50pm on 20 Oct 2010, clivos wrote:
    15. At 1:37pm on 20 Oct 2010, AndyC555 wrote (on the councils blog):
    "Only if people forget it was Labour's idiotic policies that led us into this mess."

    WHAT! The banks caused this. Lehmann brothers started a global collapse in the banking sector which caused a chain reaction in all economies across the world. Banking GREED caused a global depression. FACT."


    Writing FACT in capital letters does not make something that isn't a fact a fact. All it does is make you look silly and about 10 years old.

    We are in this mess because of a combination of things. We would, for example, have £400bn less national debt had Brown kept spending in line with inflation after 2000.

    The Government's spending plans relied on unrealistic projections of ever increasing tax revenues and even then Brown abandoned his 'Golden rule' on borrowing (after first changing it). He then abandoned his 'Golden Rule' on debt as a percentage of GDP.

    All done before the banking crisis started.

    Please, do your self a favour and do some research. And keep your fingers away from the 'shift' key.

  • Comment number 10.

    I dont think anyone should rejoice that the spending review has happend but . The waiting game is over and we will have to wait and see who is right the goverment or Labour.

  • Comment number 11.

    "None of this will determine how this saga ends" - Nick Robinson.

    Now that IS something we all want to know.

  • Comment number 12.

    "A significant number of people who now depend on housing benefit, council tax benefit, tax credits and what used to be called "sickness" benefit will receive significantly less or stop receiving benefits altogether." - Nick Robinson

    Balancing the books on the back of the poorest members of society ... is how this could be perceived (unless there's comfort in the detail).

  • Comment number 13.

    We are all in it together...but some of us are more in it than others.

  • Comment number 14.

    One suspects that even our Nick is getting slightly tired of the strapline - we are "all in it together" - and Nick goes on to say that we will all have to work longer before being entitled to a state pension.

    However, senior BBC employees enjoy one of the finest pension schemes outside of the HoC and consequently will not need to worry about the mediocre State pension.

    Not that this blogger* begrudges it - good luck to Nick and his chums.

    What should disturb most of us is the fact that 2% of our population control 90% of the wealth (according to consultants AT Kearney).

    It is hard to take in that we are heading in the pre-revolutionary direction of Nicaragua, where some 14 families ended up with most of the countries wealth.

    I saw on this blog today a comment that some 1000 familes are the hyper-wealthy, that would include the Camerons, Osbornes, Cleggs and sundry champange socialists e.g. the Blairs, Folletts and fellow travellers.

    We, the general public, might be "all in it together' but they certainly are'nt by any stretch of the imagination and what is more, they are highly unlikely to come to our financial rescue.

    * Blogger = a spotty, balding saddo ranting from Mums basement - according to Andrew Marr.

  • Comment number 15.

    The problem is to balance the creation of new jobs with the decline in employment in the public sector and the increase in people expected to be in work as the pension age rises. There will have to be retraining for a those made unemployed that has its costs and will take time. If things get too much out of step the Benefits bill could soar in the short term.

    My other concern is the cuts to communities and local government. I work with two charities which get partial funding from our local council. One will cetainly get a substantial grant, but the other may not and fractured families may lose one of the routes used by the courts to keep families in touch.

  • Comment number 16.

    Today's cuts spell disaster for many families across the UK, as they represent an ideological mantra written large across the nation’s most needy families.

    What is hidden by this is the further damage planned reorganisation of the NHS and other services provided by councils will do to those who have already lost out today.

    These people will shortly lose their houses, and their benefits. And although there is protected funding for health services, this will be spent upon removing much of the existing expertise and farming service commissioning out to those who are vastly under qualified to make the choices needed, so they will loose specialist health provision too.

    Who would have guessed that Big Society was actually No Society after all?

  • Comment number 17.

    "The next chapter is likely to examine the consequences of unprecedented cuts in welfare spending. The headline saving - £18bn in total - is, remember, the equivalent of 18 million households losing £1,000 each."



    And so it is. But unless you know that 18 million households ARE going to lose £1,000 each, it's a meaningless thing to say.

    It could be 9 million households losing £2,000 each.

    Or 27 million losing £667 each.

    Or 7 households losing £2.5 billion each.

    or if each £1 was represented by an inch, the cuts would reach out beyond the moon.

    Or if each £1 took a second to march past you, the deficit would take 570 years to march past you in single file.

    or......

    See how long that game could go on for and how pointless it is?

    Good, then don't do it again.

  • Comment number 18.

    So cuts of 1% less than those planned by New Labour pre election. I take it we can look forward to a whole series of posts from lefties along the lines - 'Well done George, you've got the balance about right'.

  • Comment number 19.

    Can someone tell me how allowing rail fares to rise helps?

  • Comment number 20.

  • Comment number 21.

    Crash Gordons Turkeys have well and truely come home to roost.

    But Him and the Millionaires from the former HMG cabinet will not be effect by the pain that is about to unfold.

    It's a shame that he is not there to sort it out, having to deleiver cuts, so sorry investement, but he only ever had a plus sign on his calculator.

    Again the tories have to sort out a labour ecomonic wasteland.

    #4 soon there will be massive pressure to send home the immigrants as this will free up housing and jobs and thus reduce the benifits bill

  • Comment number 22.

    I do hope the cuts to the BBC budget don't have a negative impact on their super efficient blog moderation service.

  • Comment number 23.

    Maybe you work in the private sector and the squeeze has turned out to be bad.

    So are you one of the people have taken joy in the fact that now it is the turn of the public sector to 'get it' (and not in a good way).

    If that makes people happy, that's sad.

    But I am sympathetic if anyone who lost their job in the private or public sector feels a little better that this blogger has occasionally been 'on-the-bench' too.

    Misery wants company.

  • Comment number 24.

    7. andy c555
    Yes i can imagine you at home .Alone. Reading the Daily mail. James blunt playing in the background. Action man figures dotted around the room.
    When we have just heard about the most savage cuts this country has seen, which will cause misery to a huge number of people. Real suffering. And you think its a big joke.
    Truly truly moronic, way beyond the next nearest moronic thing possible. Way beyond.

  • Comment number 25.

    "Balancing the books on the back of the poorest members of society ... is how this could be perceived (unless there's comfort in the detail)." - 12

    Just checked - there isn't (comfort in the detail).

    Doesn't seem right to have our poorest people picking up such a large part of the tab for a problem they didn't create.

  • Comment number 26.

    A million jobs to go - half in the 'private sector'

    But of course that is only the PWC forecast of the direct economic cost.

    Up and down the country millions of people just don't know if they will have a job next year.

    Up and down the country millions of people have decided...

    No new car
    No holiday
    No to the fitted kitchen
    No to the new carpet
    No to the house move
    etc etc etc

    How many more jobs will those decisions cost in the 'private sector'?

    Back to recession by Christmas?

    Irish style melt down?

  • Comment number 27.

    c555 @ legs

    Don't like to think of The End, Andy - so I won't. Also not keen on your "last night of the proms" thing at 7. Not appropriate* for a day on which it becomes clear that the heavy guns of the tory state are trained on the poor.

    * not sure LNOTP is ever appropriate, come to think of it - it's actually a proscribed broadcast in my neck of the woods.

  • Comment number 28.

    So after osborne sat down today. I started to think about how over the coming days the true extent of these cuts would reveal themselves and how they would affect people. Im sure there will be case studies showing how disproportianately those on lowest incomes will be affected.
    Who will hear the wife of their next door neighbour crying because the husband has been made redundant and they face loosing their home. Does anyone really understand or empathise with the misery this will cause due to the severity of these cuts.
    But its worse than that. Much worse. Because its probably not a couple of billion lost due to tax avoidance, it could well be getting on for an amount that would almost equal the savings made from these cuts. And some of the worst culprits in regard to this tax avoidance are heavily involved and sponsor the conservative party. And even worse than that, some bloggers on here who boast about organising tax avoidance schemes that reduce a 50% tax liability to 5% at £180 per hour are not content with that. They want to gloat and puff there chest out on these pages..like its christmas...while many in this country are facing dispair and misery.

  • Comment number 29.

    this is to redandyellowandgreenandblue it doesn't matter what the FTS 100 does its about pleaseing the giuld and bond markets the people who buy our countrys debt this is the reason george osborne as done the cuts like he as, they was a man on tv today saying exactly what I've just told you. he's also partly done this so we and I mean the tax payers of this country don't pay more and more intrest on our debt the money we borrow from other countrys SO THERE.

  • Comment number 30.

    Does anyone have any idea where growth is going to come from?

    We're about to have an influx of unemployed, plus VAT and tax are due to rise and so spending will most likely fall. AndyC555 is happily pointing out that the FTSE is rising, does that mean we won't even have a cheap currency to attract investors?

  • Comment number 31.

    Rejoice! The mighty cuts have been cut down to size by our very own dragon slayer George.
    See, Labour were going to cut too much. No, I mean they weren't going to cut at all. They didn't even have a plan. But our cuts are less than theirs would have been.... if they had a plan......which they didn't. But if they did, it was a jolly bad one. Don't you realise how lucky you are? We've pulled you back from the brink. What do you mean how? By doing less cutting than Labour who don't have a clue about managing the economy and only spend,spend,spend. So think yourselves lucky.
    Anyone else confused? (Apart from George)

  • Comment number 32.

    Great shame Gordon Brown the man very much responsible for this mess did not even have the guts to be in Parliment today.

  • Comment number 33.

    24.

    I agree, the degree of rejoicing over probably 1 million plus job losses is moronic...even if you agree with the politics.

    It seems obvious that this CSR is not fair or progressive. Osborne has raided the welfare budget to produce his bit of political theatre (19% only.) Before all the usual suspects start ranting about workshy layabouts, it's not just them by a long chalk and they know it. Changes to disability allowances and social housing will be a diaster for many of the poor in this country.
    And don't forget the withdraw of CT benefits.

    The LibDems should be ashamed of themselves...still clinging to the fair argument.

    Andy...the FTSE overall today was pretty flat....a bit like the majority of the population, with a few exceptions like Robin and your good self.

  • Comment number 34.

    To all those Tories who are rejoicing at the scale of these cuts, I only have two words to say, "Ireland" and "Japan".

    Elementary economics tell us that economic growth begets profits and employment which begets more tax revenues and cuts unempolyment costs which reduces deficit. Therefore, any measures that risk Economic Growth should be resisted. Look at the experience of Japan in the last two decades and that of Ireland in the last two months.

  • Comment number 35.

    All you bleating lefties do not forget it is only because of the mess left by the last government that these cuts are necessary. If the banking crisis had happened under a conservative government, labour would have said that this was the tories looking after the rich bankers. This crisis happened under Labours watch and now the country is having to pay the price of labours folly.

  • Comment number 36.

    tenmaya @ 35.

    If it was Labour's folly why did the Tories agree with their spending plans until last year ?

    And why did the Tories argue for less not more bank regulation before the crash ?

    And why are the rest of Europe in the same boat ?

    And if the cuts are necessary why did they not cut by 25-40% which they said was unavoidable before today ?


    Spare us your parroting of the shock doctrine brigade...

  • Comment number 37.

    34.

    I would add four more words "The Paradox of Thrift."

  • Comment number 38.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 39.

    @#35

    Any reasonable person knows that Labour is partly responsible for failing to control an element of the financial sector - you and others on here don't need to keep repeating it. The fact is it doesn't justify everything the coalition government is doing.

    Many genuine people, whether Labour/left-wing or not, are aggrieved with these cuts because they seem arbitrary and unfair to certain demographics. But I would go further than that. I think the cuts are a risk to growth suitable for the 21st century. Think about it. Hundreds of thousands of jobs in the public and private sectors going - and a 40% cut in higher education. Doesn't really encourage current businesses to invest in new technology and an innovative work force does it?

    Higher education needs to be protected, even economists who agree in the main with the strategy the coalition is taking, have expressed deep concern in this area.

  • Comment number 40.

    26. At 7:04pm on 20 Oct 2010, jon112dk wrote:

    Up and down the country millions of people just don't know if they will have a job next year.

    >>>>>>>>>>>>>>>>>>>>>

    Don't be such a drama queen.

    The estimated job losses are spread over 4 years, so there may be 125,000 public sector jobs lost next year.

    How on earth does this become millions?

  • Comment number 41.

    Remember whenever Labour leave government unemployment is higher than when they came into government, they only stay in government until the money runs out-FACT.

  • Comment number 42.

    38. At 8:34pm on 20 Oct 2010, john newrick wrote:

    Gordon Brown spent 13 years rewarding the feckless and penalising the responsible and now does not even have the guts to show up and face the mess he left behind.

  • Comment number 43.

    Its not all bad we could all go to the museum.There's a one up here-Beamish-it shows the harsh reality of working class folk in Victorian times.I think the tories have used it as a vision of the future.They'll probably de-classify it as a museum so they can charge entry.Baronet Osborne-tiocfaidh ar la.

  • Comment number 44.

  • Comment number 45.

    AndyC555 and AS71-you just don't seem to care about anybody else other than yourselves and as you both seem to be road systems,you'll undoubtedly be overjoyed with the transport infrastructure announcements.

  • Comment number 46.

    36. At 8:28pm on 20 Oct 2010, craigmarlpool wrote:

    And if the cuts are necessary why did they not cut by 25-40% which they said was unavoidable before today ?

    ==============

    I know it was a rhetorical question but I'll answer it anyway - because they wanted to frighten and bully the electorate into voting for these cuts based on the threat that otherwise we were destined to be a Greek-style basket-case and the "markets" would savage us. Then they spent months telling us things were actually much much worse than they imagined and even greater cuts would be needed.

    He even had the nerve to start his speech telling us how lucky we were to have a government who would take the tough choices and make the cuts that Labour wouldn't have, only to finish his speech telling us how they managed to cut less than the wasteful "socialists" would have... hmmm... I know politicians like to have it both ways but that was extraordinary. And miraculously they discovered today that the child benefit cuts, which they only announced last week, would actually save an extra £1.5 billion than they originally thought - and they say Labour are no good at figures!!!

    No, I'm afraid this was the plan from day one - scare us into voting for them, scare us a bit more, then make the same level of cuts the other lot would have except hitting those that can least afford it whilst protecting their own, which after all is what the Tories exist to do. And all whilst trying to make us feel grateful for their economic genius. Still, city bonuses are up this year so at least we're all in it together... hahaha...

  • Comment number 47.

    Osborne seems to be doing a good job from where I'm sitting. I feel a lot more optimistic about the future after todays announcements, much more than I did after Darlings last Budget speech back in March...

    George gets it, and is doing the right sort of things to fix it.

    Darling didn't have a clue and was only making matters worse...

  • Comment number 48.

    Annual International Development Budget - £11.6 BILLION

    Annual Home Office Budget - £10.2 BILLION (for Police, UK Border Staff
    and Counter Intelligence)

    Pure Madness !!!!

    We give our money away to corrupt regimes and dictators, and probably can't even afford to police our own streets, let alone look after our own needy people.

    You couldn't make this stuff up.

  • Comment number 49.

    I can’t believe that Gideon thinks that 'making work pay' means stopping Working Tax Credits for a household working less than 24 hours. I am sorry but that is just taking from people at the bottom of the scale. When you work for the likes of a big supermarket chain for example you only get between 7.5-20 hour contacts. So if you have kids it does not pay to work!!! Until of course you have been out of work for 12 months and your benefits get cut, then you are stuck in a catch 22 situation.

    I really do feel for people on benefits who are looking for work. When you have the likes of Newcastle for example, which has a large number of public sector workers, were a large percentage will lose their jobs, were there will be a very small amount of private sector jobs which will more than likely be fixed term 20 hour contracts, what are you supposed to do???

    Honestly people how can we listen to a Chancellor, Who has never had to budget for anything in his life, looking after the public purse, while attached to the puppet strings of the Rupert Murdoch Media Machine.

    Welcome to 1979/80 all over again :-(

  • Comment number 50.

    So...at last the big hoax begins. The review is not about austerity, but creating business opportunty at the expense of public services, or should I say to replace public services.
    The banking crisis caught up with all the gamblers and charlitans and they are looking for a new home to exploit...move over public services. The service industry will be the new massive area of business expansion in this great country to replace perfectly good and professional services with a profit driven equivalant. This beggers the question of what we will be exporting, could it be our redundant public service workers who have no desire to work for minimum wage in the replacement private sector jobs?

  • Comment number 51.

    2. Nick – we’re back to TINA.
    Does anyone imagine that the financial markets would have tolerated a do-nothing approach to expenditure earlier this year when Eurozone was in crisis? We're still waiting for Labour to spell out in detail what they would be doing had they been in office.

    – I believe Labour appear to suggest they would not have cut as fast, as much or as deep so soon.

    - ARH Reading
    There’s almost always a ‘choice’, or alternative, in matters such as these… It’s just easier to pretend that there is ‘no choice’ when something happens to match your own particular beliefs or agenda. For example, do you really believe, even now, that if the spivs, speculators, bankers and financiers in the ‘City’ needed another bailout again very soon then they would not get their request? Why do I feel certain that it they required another £1Trillion in bailout guarantees then they’d get everything they asked for with ‘no questions asked’ from Dave, Nick and Gideon?


    2 & 29.
    2 - These are balanced judgements but given the views of the Bank of England, IMF, CBI etc the government appears to have taken the right course for the right reasons…

    29 - this is to redandyellowandgreenandblue it doesn't matter what the FTS 100 does its about pleasing the giuld and bond markets the people who buy our country’s debt this is the reason George Osborne as done the cuts like he as, they was a man on TV today saying exactly what I've just told you. he's also partly done this so we and I mean the tax payers of this country don't pay more and more interest on our debt the money we borrow from other country’s SO THERE…

    Something else to ask is as follows. Are the British electorate now a defunct entity? Why bother to have general elections anymore if the opinions, whims and desires of the Bond markets, IMF, Bank of England, Ratings Agencies (completely discredited ones), CBI/ Corporate CEO’s all matter more to the government than the electorates will? Why do political parties and voters bother with manifestos if they are so readily discarded in favour of ‘tough decisions’ once ‘power’ is obtained?

    It seems clear we have entered an era of overt corporate feudalism. The astonishing fact is that those at the ‘top of the pile’, be it financial, corporate or political, who hold the key power levers for the country all appear to be besotted with, of ALL things, what can only be described as economic/ financial ‘socialism’… But only exclusively for themselves in their miniscule clique… It’s ‘free market’, ‘Devil take the hindmost’, every one for themselves, race to the bottom, raw capitalism for the other 99%.

  • Comment number 52.

    45 KemaNaan

    AndyC555 and AS71-you just don't seem to care about anybody else other than yourselves

    >>>>>>>>>>>>>>>>

    I do care about people losing their jobs but we need to discuss it in a rational manner. No point pretending that an estimated 125,000 public sector job losses next year is millions of job losses.

  • Comment number 53.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 54.

    I just saw Clegg on TV letting out a very enthusiastic "hear-hear" as Osbourne announced how necessary these cuts are. Excuse me... is this the same Clegg who campaigned on a manifesto that cuts of this severity were NOT necessary? Good luck at the next election Nick!!

  • Comment number 55.

    No surprises I'm afraid! As an ex civil-servant who served under governments of both colours and having learned to be A-political, and having no preference one way or the other, here are a few observations to consider.

    The decline of British Industries:

    Shipbuilding began to declie after the tories had ploughed millions of taxpayers money into the pockets of the chosen few and left others to pick up the pieces

    The British Motor industry went into sharp decline during Conservative stewardship

    British Steel industry went into fre-fall collapse during Tory stewardship

    Mining too fell into decline, nay - complete collapse during ? You guessed it Tory stewardship!

    Methinks this is all too much of a coincidence - you cant blame it all on the Labour party because most of this happened during long spells of tory reign.

    It may come as no surprise to learn I left the civil service of my own accord when the tory government of the day asked me to forego 25years of training as an Advice, guidance and Counselling officer to become a benefit policeman

    I warned the British public that Mr Cameron was the most dangerous posible Prime Minister for 200years before the election - no-one listened.

    However the public get what they deserve and Mr Clegg and his Party of Political Prostitues will help bring this country to its knees.

    Whats next - be warned banking may well go into free-fall and when it happens there will be no economy only anarchy and survival of the fitest with Money Barons weilding power - sound familiar?

  • Comment number 56.

    Interesting how Osborne "found" extra welfare savings - picked the pockets of the poor, in other words - in order to be able to pull the purely political stunt of announcing 19% departmental cuts (being 1% less than Labour's). Remember Brown and the abolition of the 10p rate? (for which he was rightly criticised). Depressing re-run. People playing politics - trying to make a name for themselves - and not caring a fig about who gets hurt.

  • Comment number 57.

    Another very brief observation!

    Where are all the current and future graduates from our universities going to work when they have their degrees - theres not going to be anywhere for them to work!

    Ah well, guess we're educating for another Brain Drain - Does that sound familiar, Too?

  • Comment number 58.

    re #6
    Yes, I rate Johnson, too. But down one, at least, on the high rating I gave him yesterday. His reply was bitter, disjointed, unconnected and contained a measure of spin. I suspect it was as much a reflection on what colleagues assisting him came up with at short notice as it was of the man himself. A poor show. I could have written a better response in ten minutes.

    Balls and Cooper studied economics as part of a degree. They then worked as leader writers - hardly qualified as journalists - for a couple of years. Neither have worked beyond that outside politics or as economists. (It could be rightly argued that they are 'economicists'. Merely wannabees.) All we would have got from them was even more spin and denial.

    GO sounded good albeit frantic - almost desperate to get out of there and do some more work. He has a lot to do. On things he didn't mention like interest rates and inflation. And on the next stage. Fiscal reform.

    He has to deliver. The Conservatives have a poor record on that. But he really stuck it to Labour. Big time.

    Hey! Let's be a little slower with what we say and a lot more careful with everything else out there tomorrow, George.

  • Comment number 59.

    44. At 9:09pm on 20 Oct 2010, alfsplace1986 wrote:
    =========================================================================
    This list just demonstrates how bad the Civil Service is, or how good they are.

    On the one hand you could take from this list that the civil service is incompetent and cant sort out their own house. Hence the amount spent on consultants.

    On the other hand you do not want change or any changes to stick. So you employ consultants to come in and facilitate change. You guide them to come up with solutions that don't actually deliver what is needed and are impractical to implement. The consultant are so keen to "do it with you" rather than "do it to you" they fall into the trap. The change that is implemented does not deliver at the level required and is easy to discredit further down the line, so the changed is slowly eroded. Job done as they say. Hence the amount spent on consultants.

    And if you think the latter sounds too much like "Yes Prime Minister" to be true, you obviously have not worked with and for senior civil servants.

  • Comment number 60.

    re #46
    What The Coalition did was to feint - like a boxer or footballer - one way, lead their opponent (LABOUR) into committing themselves, and then pull back the other way to go by them.

    Neat. Very neat.

  • Comment number 61.

    Its amazing when you name names your comment is moderated-they were mostly described on C4's Dispatches and mentioned in the expenses scandal.

  • Comment number 62.

    Where's Rocking Robin?

  • Comment number 63.

    Does the repayment of money lent to the banks which largely caused the defict, count as a key factor in reducing the deficit - or is the timescale for ever? Does the spending review assume the same disposal revenues assumed by Gordon Brown?
    Maybe silly questions but almost as bizarre as the connundrum of where the new jobs are coming from for those like my thirty year son who was made redundant by EON in Stoke on Trent. Despite searching relentlessly the prospects of new job growth seems remote. He gets no state benefit, only his old dad's depleted pension.

  • Comment number 64.

    As an average Joe I can't see where, the VAT increase apart, any of these £81Billion cuts/taxes are going impact on yours truly.

    £18,000,000,000 is a big number when you display all the zeros.

    I can't see my increased VAT bill making much of an impression on the last, let alone the first, zero.

    Surely I'm not alone in thinking that this CSR announcement, and reaction to it, is all a bit overblown.

    Let's all pause for breath and re-convene in a years time.

  • Comment number 65.

    56 saga

    Interesting how Osborne "found" extra welfare savings - picked the pockets of the poor, in other words - in order to be able to pull the purely political stunt of announcing 19% departmental cuts (being 1% less than Labour's).

    >>>>>>>>>>>>>>>

    No problem with the extra welfare savings, but I agree that the stunt at the end was unpleasant.

    My main thoughts overall are:

    1. Economic madness to stick to ring-fencing the NHS budget given the size of it and also the rate at which it grew under the last government. There must be some fairly painless cuts here which would ease the burden in other areas.

    2. There is a big difference between reforming public services to deliver more for less and simply reducing spending. The opportunity to re-design the way services are delivered must be taken.

    3. I am broadly in favour of the plan but no-one knows for certain whether it will or will not work, it would be good to have some detail about Plan B (even though governments never like to admit Plan A might not work). If the economy recovers more quickly than planned, then tax cuts are probably the way to go. If more slowly, then what, more borrowing or more cuts?

  • Comment number 66.

    Why aren't the BBC kicking up about the real cuts to their budget;thus opening the door for Messrs.Rupert and Stuart Murdoch to further pull the strings of this totally back door government.

  • Comment number 67.

    Crikey you'd think that Osborne had stolen everyone's firstborn. The fact is we need to have a shrinkage of the state. You can blame this partly on Labour's profligacy and partly on the Tories wanting to trim the state for ideological reasons. Personally I think a re-evaluation isn't a bad thing and those people who lose their jobs will be made redundant so they'll get a healthy pay-off and then they'll be able to start a business or get by however they can, the same as everyone in the private sector. Life's hard and none of us have a right to a job but cuts across the board seem to be the fairest way to do that.

  • Comment number 68.

    3000 fewer prisoners? Well obviously. There won't be anything left to nick.

  • Comment number 69.

    Suggest all above stop whittling (sp) as you have done for the last few weeks. No discussion really required. We have to reap the whirlwind of the previous Government and get ourselves back onto some sort of even keel. Take the pill...and swallow it like a man (which most of you seem to be). Then get on with your lives... which will undoubtedly still go on.

  • Comment number 70.

    Yes, the banks helped to worsen the recession, but New Labour was its prime mover with the way it let borrowing rip and the huge increase in public sector employment. Anyone who voted Labour has to carry some responsibility for where we find ourselves today.

  • Comment number 71.

    All I here is FAIRNESS, which seems to the the lefts way of getting socialism through the backdoor.

    WELL I DO NOT THINK IT IS FAIR THAT ONE PERSON CRASH GRODON HIMSELF SHOULD HAVE WRECKED THE ECONOMY FOR myself,my children and my childrens children future. That is not FAIR at all.

  • Comment number 72.

    24. At 6:57pm on 20 Oct 2010, lefty10 wrote:
    "7. andy c555
    Yes i can imagine you at home .Alone. Reading the Daily mail. James blunt playing in the background. Action man figures dotted around the room.
    When we have just heard about the most savage cuts this country has seen, which will cause misery to a huge number of people. Real suffering. And you think its a big joke.
    Truly truly moronic, way beyond the next nearest moronic thing possible. Way beyond."

    I read The Times, top peoples' paper and all that.

    I can imagine you at home, another empty tub of lard upturned in front of you, wooden spoon in hand, banging away and chuckling at the noise, making your speech (you only have one speech) whilst outside, the rest of the world goes on, ignoring you.

    Oh, and a couple of small facts (I know you're not keen or even acquainted with many of those). Firstly, these are not "the most savage cuts this country has seen" as you will no doubt hysterically screech to anyone stuck in a corner and forced to listen to you, they are the biggest cuts since 1976, when Labour last bankrupted the country and had to go cap in hand to the IMF. Secondly, the level of cuts are within 1 or 2% of those proposed by Alistair Darling, so spare us yet another anti-Tory hissy-fit. We're in a mess because of your beloved Labour, now the Coalition is doing its best to get us out of it.

  • Comment number 73.

    #65 particularly item 2. have been campainging for 7 years for a total reform of the family courts and CAFCA-SS and legal aid surrounding this area.

    yesterday on R5L Nick Campbell @9:30 debating cuts a Social Services lady was allowed to go unchallenged about blaming Bady-P events on lack of resources for about 5 mins. I tried to take part by indicating that it was not resoures but how the resources were "thinking" , thier matra of opperation etc, the BBC does not like that view being.

    what social servies need is not more money and a change of thinking

  • Comment number 74.

    30 - "AndyC555 is happily pointing out that the FTSE is rising"

    I was merely sarcastically responding to Thom who (about 20 minutes after Osbornes speech ended) said that the measures can't have been good because the FTSE had fallen (it had, 0.14%). It seemed to me idiotic to try and make a political or ecomonic remark based on a tiny inter-day shift. I responded in kind.

    My apologies if you thought it anything more than that. It will, of course, be many months before the impact of the cuts on the economy as a whole is known for sure.

    Of course there are some lard-tub thumpers on here who probably still don't get it.

  • Comment number 75.

    72. c555
    No. You were mocking and jeering. And nothing you write excuses you from doing this when many in this country are suffering and are going to suffer as a result of these cuts. The more you post the more moronic you sound.
    Keep going.
    And while your at it you still havent answered the questions i have asked you several times.
    Please explain
    1. How this tax scheme works you developed that got 50% rate taxpayers paying just 5%
    2. Does it make you feel good that you personally prevent hundreds of thousand of pounds of tax money from going to essential public services.
    3. Can you explain what would happen to public services if everyone paid just 5%

    Of course i expect some half baked cocky answer that doesnt answer the question....and more childish inane rubbish.

  • Comment number 76.

    "75 - Please explain
    1. How this tax scheme works you developed that got 50% rate taxpayers paying just 5%
    2. Does it make you feel good that you personally prevent hundreds of thousand of pounds of tax money from going to essential public services.
    3. Can you explain what would happen to public services if everyone paid just 5%"

    I had actually drafted an answer the last time you posed this question but the HYS board closed before I could post it, so here goes again....

    Employer sets up an Employee Benefit Trust, contributes money to it, EBT loans money to employee. Taxed as a beneficial loan at the official rate of interest (currently 4.75%). No CT deduction, of course, but then there isn't for dividends. Assuming top rate tax payer, he's now paying 50% of 4.75% of (say it's a company paying CT at SCR) 79% of what would have been a bonus of "100%".

    Quite simple really. Downside, the tax charge arises each year. If the employee held the loan for around 17 years it's only tax neutral. BUT if employee ceases to be employee benefical loan charge ceases too, so ideal strategy for someone nearing retirement or planning on selling the business.

    Now, I lnow what you're already thinking, Lefty, you being a bright chap....but the loan is still outstanding! So it is and the Trust can write the loan off on the death of the ex-employee. The thing about that is that although the writing off of the loan AFTER death doesn't create a tax charge, the existence of the loan AT death reduces the value of the estate and so reduces IHT.

    But, hey, you'd probably thought of something similar yourself.

    What effect will it have on jobs and services? Minimal, won't be noticed. The scheme is attractive to mainly 50% tax rate payers (indeed there was little interest in the scheme before the 50% rate was introduced). The 50% tax rate as a WHOLE is excpected to bring in less than £1.6bn a year. Remember the pointless temporary VAT reduction? Had no effect on the economy at all, just cost the exchequer £12bn.

    I've said it so many times, higher tax rates do not result in a proportionately higher tax take. The Government is an animal the size of the largest dinosaur that ever lived. I'm just a tiny shrew taking a couple of acorns off the tree before the dinosaur eats them.

    I'm doing nothing illegal. HMRC have no problem with what is being doone, they've seen and passed the scheme. We keep full books and records, not the slap dash, "maybe I'll record it maybe I won't" methods others use.

    I'll give you a choice of two roads to the same destination, both 50 miles long. You need to get to your destination in 50 minutes. One road has a speed limit of 60, the other a speed limit of 30 and is littered with speed cameras. Are you seriously saying you'd chose the slower road, break the speed limit and pick up speeding fines? Would you accuse someone who chose the other road of being a 'speeding ticket dodger'?

    How about you? Are you donating every single penny you don't need to stay alive to help charities? Have you taken on your employee as a full partner so that they can share in the profits of the business rather than be exploited by you? No, course not, because (as always) you can hypocritically defend what you do whilst it's always someone else you think should be doing more.

    Now, if you do set up a partnership, I'd recommend an LLP structure and if you ask nicely, I'll explain how having a corporate member of the LLP can reduce your tax bill.

  • Comment number 77.

    I love the BBC's irrepressible need to change the emphasis of a story..

    So last night we have the hysterical wailing ont he ten o'clock news that 'millions will be affected' by these cuts...

    What they failed to say was.. 60 million will be affected.. the whole country is affected and the coalition is not denying it.

    Perhaps they should have looked at the YouGov survey that suggested that only 25% think the labour party have a serious alternative... and reading sagamix's posts I am hardly surprised.

    It's a great time to be a tory... (with apologies for abscences Up2snuff)

  • Comment number 78.

    AndyC555 will be interested to know that the FTSE has fallen since opening, after gaining only a few points by the close of yesterday. This is hardly a show of strong support and excitement amongst investors in response to George Osborne's Comprehensive Spending Review.

  • Comment number 79.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 80.

    AS71 @ 65

    Ring fencing the NHS is an example of the politics trumping the economics. One has to accept this will happen to some extent - this being primarily a political process - but hopefully not all the time. That the politics is the main driver actually has a certain logic since no-one has a clue about the economics; they only pretend they do.

  • Comment number 81.

    76 - And I KNOW what you're going to say Lefty. That isn't 5%, it's 3%.

    I know, I know. It's just that the rate is 3.3% equivilent for a employing company paying CT at full rate and 3.48% if the company pays CT at marginal rates and so rather than give completely accurate figures we just use "5%" as a shorthand as it's easy for a client to get his head around, being 1/10 of the 50% rate.

    75 - "half baked". Nothing I do at work is half baked, it's always baked to perfection.

  • Comment number 82.

    Thom Brooks..

    the FTSE is now rising. Are you really going to appear every time there is a move and tell us point by pint what is the reaction the the spendnign review.

    If you want a real statistic.. in thirteen years of newlabour the FTSE went absolutely nowhere.. except up and straight back to where they started. After only five months of coalition the FTSE is already up nearly 17%... now that's a result.

    It's a great time to be a tory...

  • Comment number 83.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 84.

    "Turn a page or two and we'll find out which jobs and services councils have to cut to save around a quarter of their budgets."

    Not true I'm afraid Nick. There will be 26% cut in governemnt support to Councils, but Council Tax levels, which fund a fair proportion of expenditure, willl stay the same or increase.
    The figure roughly equates to 16%, or 4% every year. Given that most Councils overcahieved the Gerson effciency target of 3% per annum, and that Adult Social Care will receive a bit of bunce, it doesn't seem too onerous. Or does it?

  • Comment number 85.

    #6 Sagamix wrote:
    "Well, yes. I do rate Johnson"

    You may remember that I was quite prepared to praise Milliband's first PMQs.

    I have to say that Johnson was just weak, and indeed very weak yesterday. He appeared to have learnt a few phrases (the Labour 'line to take') without any at point suggesting that he understood what he was talking about. His questions were poor, and his arguments were comprehensively dismissed by Osborne (his reply was only on the BBC Parliament channel).

  • Comment number 86.

    Just what this country needs!
    What a joke labour continue to be, same old drivel.
    Ed Miliband was so out of his depth at PMQs. Labour have definitely picked the wrong person to be their leader.

  • Comment number 87.

    Firstly, have to agree with Post # 80. Why should the NHS be ring-fenced? Does anyone seriously contend that this 'service' provides value for money and shouldn't be subjected to at least a review of its inefficient and over-managed bureaucracy?

    Let's be clear - these cuts really aren't swingeing.

    In the private sector (I declare an interest) cuts averaging around 5-6% a year in an inflated budget can be easily attained. Given the circumstances facing Great Britain Ltd., if it were a private sector company, far deeper cuts would be being made. But like a junkie, GB Ltd needs to be weaned off of its debt fix. Shame!

    Questions for private sector employees - How much do you contribute to your pension fund? Would you consider paying an extra 3% so that you can have a cossetted, inflation-proof final salary scheme? Would you then bleat about being squeezed or would you snigger at the great deal you will still be getting and keep quiet?

    490,000 job losses over 4 years. Public sector, please moan now. Done? So how many of these will be natural wastage (apologies for using the 'wastage' word around public servants)?, how many will be retirees, early or otherwise?, how many will actually be noticed?

    A young girl (late twenties) was interviewed on the TV, last night. She was bemoaning the fact that her benefits would be cut. She appeared to have no obvious disabilities but hadn't worked for over ten years and had been claiming benefits, all that time, because she had been involved in a car accident.

    Writing at the weekend, Nigel Lawson urged George Osbourne to be bold. Sorry but on the settlement for the devolved assemblies, he has lost the plot and missed an opportunity. Students in Scotland pay no fees, unless they are English or non-EU! Students in England will face fees of up to 7,000 a year. George, do you actually think that being nice to the Caledonian ingrates is going to win you any votes?

    Scrap the Barnett formula, now! Recognise that times have changed, everyone else does.

    I could go on but I guess you get my point.


  • Comment number 88.

    "78. At 08:42am on 21 Oct 2010, Thom Brooks wrote:
    AndyC555 will be interested to know that the FTSE has fallen since opening, after gaining only a few points by the close of yesterday. This is hardly a show of strong support and excitement amongst investors in response to George Osborne's Comprehensive Spending Review."

    Not this again. Please.

    The FTSE 100 currently stands at 5752.13. Yesterday afternoon it had dipped to 5695 before closing at 5728.93. That means that it is currently UP today. By the time you read this it might be down but that means nothing about the city's reaction to Osborne's plans.

    I repeat, it is idiotic to try and draw conclusions from micro-movements intra-day. I don't, so could you just give it up as well.

    Still, if you are the sort who wants to constantly watch the FTSE 100 and try and draw conclusions minute by minute on macro-economics, here's a website that might also keep you entertained.

    http://www.puffgames.com/bubblewrap/

  • Comment number 89.

    #5 balancedthought wrote:
    "The really nasty cuts are the reductions in Housing benefit which are aimed at ethnically cleansing the Center of London of poor people."

    Aside from the fact that there is only a weak correlation between wealth and ethnicity, why should the taxpayer subsidise people to live in expensive areas of Central London when there are less expensive London locations available? There is no right to be able to afford to live in Mayfair.

  • Comment number 90.

    As a follow-up to Post #78 and Post # 88

    #78 - institutional investors 'price in' events such as happened yesterday. A downward movement would likely indicate they are disappointed at the scale of the reduction in spending increases.

    # 88 - spot on.

  • Comment number 91.

    1) Transferring resources from the public sector to the private will increase economic growth because the private sector has been shown to be more productive.

    2) It is important to increase the gap between low paid workers, and people who could work but do not. The pincer movement is a) reducing welfare payments; b) increasing the minimum wage on a regional basis, i.e. higher in London and the South East (not decreasing it elsewhere); c) removing millions of low-paid workers from income tax (the one LibDem policy of which I approve).

    As Thatcher said, the method is economics, the task is to change the soul.

  • Comment number 92.

    I see retail sales for September are DOWN.

    (Factory orders also down, mortgage lending at lowest level for 10 years etc etc)

    So the public schoolboys inherit a modest recovery - just the upturn after recession, nothing for labour to be proud of - and before the cuts even really start they have trashed the growth.

    Well done.

    Recession by Christmas?

  • Comment number 93.

    Speaking, as I was , of timidity, why not raise the pension age to 68 and for all. Stay with the 66 at 2020 (I will be affected but will do my part) but then say by 2025 it will be 68 (this, by the way, is in line with Norway, which could actually afford to pay pensions much at a much younger age)

    Surely those currently in their early fifties can plan?

    Think of the boost that will give to the stock market and to employee pension plans as the pensions 'black-hole' significantly reduces. Might even get Thom Brooks smiling!

  • Comment number 94.

    JH66

    I agree that nobody has a right to live in Mayfair. However, you're getting dangerously close to the politics of envy that left-wingers are regularly decried for.

    There is a pragmatic issue here: central London requires huge numbers of low-paid workers to grease its wheels. Cleaners, hospital porters, nursery assistants, etc. They need to live in London - though not, granted, in Mayfair. (They could slum it in Chelsea.) It should be possible to target housing assistance towards these vital low-paid workers, who already constitute a large proportion of recipients. Extreme but very rare examples - the single mother of five on benefits who would have to be earning half a million a year to pay her own rent - may shift copies of the Daily Mail but shouldn't distract serious-minded people like you for too long.

  • Comment number 95.

    AndyC555 @ 72
    You have my sympathy Andy. Must be very difficult trying to keep up with the latest spun version of the Coalition. George did it again on the radio this morning. Labour didn't have a clue. They didn't have a plan. I rescued you from disaster. But at the same time crowing our cuts are less than labours. That would the cuts in the plan they didn't have?
    Seems to me that a lot of the right wing posters here would have been better off voting Labour. Then they'd have got the sort of tough cuts that they have been telling us are essential to our recovery.
    What a Carry On.

  • Comment number 96.

    82 - "in thirteen years of newlabour the FTSE went absolutely nowhere"

    good point Robin.

    Yes, Thom, you're obviously a keen fan on using the FTSE to interpret the success of Government policies.

    Could you comment on these figures?

    Prior to 1997, the FTSE 'allshare' index was used as the measure of performance, after 1997 this switch to the FTSE top 100)

    FTSE allshare index May 1979 (Tories win election) - 280.3

    FTSE allshare index May 1997 (Labour take over) - 2138.9
    FTSE 100 index May 1997 (Labour come to power) - 4445.0

    FTSE 100 index May 2010 (Labour finally booted out) - 5123.3

    FTSE 100 today - 5760.9


    % increases -

    17 years of Tory Goovernment - 663%

    13 years of Labour - 15%

    5 months of Coalition - 12.5%

  • Comment number 97.

    Andy @ 88 looking at the FTSE over the long or the short term is obviously no way of judging economic policy.

    Afterall these are the same markets that roared ever upwards at precisely the time dear Gordon kept spending above the inflation rate and relied on unrealistic projections of ever increasing tax revenues.

  • Comment number 98.

    #94 pd65

    Yes, though my other post proposed increasing the minimum wage in London (a nice socialist idea) which would, at least to some extent, ameliorate the problem.

  • Comment number 99.

    Oh dear. Seems putting down the details of the £6 billion Vodafone give away by Osborne has upset someone. Get over it. We will have to thanks to Gideon's pardon.

    If this is the type of thing GO gets up to, why should we believe the cuts will be fair and balanced.

    As some here may say...Same Old Tories

  • Comment number 100.

    Andy @ 96

    I think you would have to compare the FTSE with other markets before drawing any conclusions. The Dow Jones, for example, shows a similar pattern with very steep increases throughout the 1980s and 1990s and a sharp drop in the last three years. The Dow Jones and the FTSE have both risen at similar rates since July of this year, with a wobble in September. Unless you're also claiming the Coalition has boosted the Dow Jones after Gordon Brown wrecked it, then perhaps it's best not to make too much of these correlations.

 

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