Cuts will haul Britain back from edge: finance minister

17th October 2010, Comments 0 comments

Britain's finance minister said spending cuts to be unveiled this week will restore credibilty to a country that had been on the brink of bankruptcy as he vowed Sunday to see the measures through to the end.

George Osborne said Wednesday's comprehensive spending review -- the biggest test yet for Prime Minister David Cameron's coalition government -- was now complete, some five months after it inherited a record deficit.

"Our plan is the plan that will restore credibility to the public finances," Osbourne told the BBC.

"We have to see this through and the course I set out in the budget (in June) is the one that we have to stick to because people in this country know we were on the brink of bankruptcy.

"If we're going to have growth and jobs in the future, we've got to move this country into a place where people can invest with confidence."

The Conservative-Liberal Democrat coalition inherited a record deficit from the previous Labour government and indicated it would take radical action to tackle this in an emergency budget in June.

Cameron's government is proposing spending cuts which will average around 25 percent over four years in many departments from next April.

Public sector borrowing is forecast to hit 149 billion pounds (170 billion euros, 238 billion dollars) in 2010/2011.

But opposition politicians warn the measures are too harsh and could threaten Britain's economic recovery.

Defence and welfare look like two areas which could be hard hit by the spending cuts.

While admitting that defence had been "the most difficult of all the budgets" to reach agreement on, Osborne insisted that the agreement would not affect the operations of the some 10,000 British troops in Afghanistan.

"What we have come up with is a settlement that first of all absolutely secures the funding for the troops in Afghanistan," he said.

Elsewhere, in an interview with the News of the World newspaper, Osborne launched a stinging attack on people who cheat the welfare system -- a huge source of state expenditure here -- and vowed to clamp down on them.

"This is a fight. We are really going to go after the welfare cheats," Osborne told the tabloid.

"Frankly, a welfare cheat is no different from someone who comes up and robs you in the street. It's your money."

© 2010 AFP

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