Osborne finds £14bn of welfare cuts

2015-07-05 14:30
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London - Britain's finance minister George Osborne on Sunday said he had found all £12bn of welfare cuts he needs as part of his plan to balance the current account deficit by 2017/18, speaking ahead of his budget announcement on Wednesday.

The budget is Prime Minister David Cameron's Conservatives' clearest chance in almost two decades to remould Britain into a low-tax, small-state economy after an unexpectedly decisive election victory handed Osborne a mandate to make deep cuts.

To meet his target, Osborne says he needs to cut the annual welfare bill by £12bn, make £13bn of departmental spending reductions, and to raise an extra £5bn by clamping down on tax evasion and avoidance.

"We have found that £12bn of savings in welfare that we said we'd be able to find," Osborne said on BBC television, without specifying full details. "We've got to have a welfare system that is fair to those who need it, but also fair to those who pay for it."

But the opposition Labour Party warned against "self-defeating" spending cuts.

"On the deficit we need, of course, sensible savings but I want to see proper welfare reforms, proper public services that aren't self-defeating, that aren't going to cost much more for the country in the long term," Labour spokesperson Chris Leslie told the BBC.

Osborne said that people living outside London would be subject to a lower cap than previously thought on the total amount of benefits they can receive. The cap will be reduced to £23 000 for those living in London, in line with pre-election promises, but he did not set out the lower ceiling that would apply elsewhere.

He also said those on high incomes in subsidised local authority housing would have to start paying closer to the market rental rates.

The Sunday Times reported that Osborne plans to launch a £650m raid on the BBC to help cover the country's benefits bill, forcing the corporation to meet the cost of free television licences for the over-75. 

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