Main points of Britain's emergency budget

22nd June 2010, Comments 0 comments

Here are the main points from Britain's emergency budget, presented by new finance minister George Osborne to the House of Commons Tuesday:

- Structural deficit set to be eliminated within five years

- Seventy-seven percent of this change will come through spending cuts and 23 percent through tax increases

- Welfare cuts worth 11 billion pounds (13 billion euros, 16 billion dollars) by 2014-15, including child benefit frozen for three years, maximum limits for housing benefits being introduced and a tougher assessment being introduced for disability allowance

- Public sector workers facing a two-year pay freeze

- Government accelerating moves to raise the state pension age to 66

- Most government departments facing cuts of around 25 percent over four years, an overall figure of 17 billion pounds by 2014-15

- Payments to Queen Elizabeth II for carrying out royal duties to be frozen this year and subsequently facing a shake-up

- Value-added tax (VAT), a form of sales tax, to rise from 17.5 percent to 20 percent from January 2011

- Growth forecast lowered from 2.6 percent to 2.3 percent next year and set to rise back to 2.7 percent in 2014 and 2015

- In a joint move with France and Germany, government introducing bank levy covering British banks and the British operations of foreign banks, which is expected to raise two billion pounds annually

- Unemployment expected to peak this year at 8.1 percent and then fall each year to reach 6.1 percent in 2015

- Link between basic state pension and earnings to be restored from April next year.

© 2010 AFP

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