Downing Street Says » Spending cuts

Asked about the leaked Treasury document which said there could be up to 1.3million jobs lost over the next five years due to planned spending cuts, the Prime Minister’s Spokesman (PMS) said that the Treasury had put out a statement pointing to the Office of Budget Responsibility’s forecast, which showed that unemployment would fall in every year and that employment would rise.

Asked if Downing Street was disputing that there could be job losses in the public sector of around 10% in the next five years, the PMS referred reporters to the Treasury for exact figures and made clear that plans made before the Budget stated that public sector employment was falling. Ahead of the decisions taken in the Budget, public sector employment was already falling because the public expenditure restraint was already programmed in. The broader point was that it was not possible to continue funding jobs in the public sector on the back of an unsustainable budget deficit. In order to see growth and employment in this country over the long term, we needed to tackle the budget deficit.

Asked about public/private sector figures, the PMS said that there was an overall employment number published in the Red Book, but it was not broken down into the public and private sector. Under the Government’s plans we would expect to see a rebalancing from the public to the private sector, both in terms of share of national output and in employment.

Asked about areas in the UK that were more reliant on the public sector, the PMS said that this was precisely why the Government had made the announcement it made both in the Budget last week, and yesterday about the Regional Growth Fund. Some regions of the UK could be more affected by the cuts, therefore it was important to take action to support private sector employment in those areas. We had the National Insurance Contribution holiday, which would be regionalised, and the fund announced yesterday. There would be other measures in due course and Government departments would be thinking carefully about what they could do to support growth in all regions.

Put that the Government had boasted about being more transparent, the PMS said that the Government had lived up to those claims by producing more information in the Budget document than had been produced in the past.

1 Comment »

As someone who works for the NHS, I am delighted that our budget is protected. This makes sense because most people do not use the alternative, ie the private sector. If the government were to introduce a tax break for individuals and companies for the cost of private health insurance, the use of the private sector would increase with significant relief for the NHS. Insurance premium tax would fund at least some of the cost and employment in the private sector would increase. As a positive side effect, at least some of our ex nurses who are doing low to middle range management in the NHS would find themselves real, professionally satisfying clinical jobs in healthcare again.There is spare capacity in healthcare and it could be used only if our ministers were bold enough to implement some REAL changes.
Comment by DR SM Khorshid — 2 Jul 2010 on 12:44 pm | Link

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» Wednesday, June 30, 2010

Spending cuts

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