Spending cuts could lose Britain 1.3 million jobs: report

30th June 2010, Comments 0 comments

Britain's austerity cuts could result in the loss of up to 1.3 million jobs over the next five years, according to an assessment by the Treasury department leaked to a newspaper on Wednesday.

The Guardian said that unpublished estimates suggested the government was expecting between 500,000 and 600,000 jobs to go in the public sector and between 600,000 and 700,000 to go in the private sector by 2015.

Finance minister George Osborne launched an emergency budget last week detailing higher taxes and major spending cuts -- including slashing ministry spending by 25 percent -- aimed at paying off Britain's record public deficit.

The Treasury is assuming that private sector growth will create 2.5 million jobs over the next five years to compensate for the spending squeeze, the Guardian said.

In his emergency budget statement on June 22, Osborne said he expected unemployment to peak this year at 8.1 percent and then fall for each of the next four years to reach 6.1 percent in 2015.

The Treasury was unavailable for comment on the Guardian report.

© 2010 AFP

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