Chancellor George Osborne announced on Monday a wide-ranging set of government spending cuts as part of his ambitious plan to turn Britain’s deficit into a surplus by 2020.
The transport, environment, local government and finance departments will have their day-to-day budgets, excluding capital expenditure, cut by an average of 8 percent each year for the next four years, Osborne said.
Osborne, considered the frontrunner to succeed Prime Minister David Cameron, is seeking to shore up his credentials as someone who can deliver his Conservative Party’s vision of a smaller state after an embarrassing parliamentary defeat on welfare cuts last month.
Britain’s economy has returned to growth under Osborne, but his critics accuse him of crimping its recovery with spending cuts. They also point out he failed to meet his original target to eliminate the deficit by 2015.
In his speech on Monday, Osborne hit back at those critics, adopting an unapologetic stance over spending cuts.
“If our country doesn’t bring the deficit down, the deficit could bring our country down,” he said. “That’s why, for the economic security of every family in Britain, the worst thing we could do now as a country is lose our nerve.”
Britain’s deficit was 4.9 percent of GDP in the 2014/15 financial year — still one of the highest among advanced economies.