Osborne Says Civil Servants Are Committed to Carrying Out Spending Curbs

Chancellor of the Exchequer George Osborne dismissed suggestions from former top civil servants that he will fail to push through the spending cuts needed to narrow Britain’s record budget deficit.

Osborne said officials are determined to implement the program after Rachel Lomax questioned last week whether the proposals are “going to stick” and John Gieve said it’s “most improbable” the government will achieve its objectives. Lomax headed the civil service in three government departments from 1996 to 2003, while Gieve was in charge at the Home Office from 2001 to 2005.

“The current civil service is committed to the plan,” Osborne said in an interview in Beijing today.

Proposals to reduce expenditure by 81 billion pounds ($130 billion) a year by 2015 and the targeting of welfare payments in particular have sparked opposition both among the public and from some lawmakers in Prime Minister David Cameron’s coalition of Conservatives and Liberal Democrats, which took power in May.

Osborne plans to cut the deficit to 2 percent of economic output by 2015 from more than 10 percent today. Lomax and Gieve have experience of implementing spending cuts in the 1980s and 1990s. Both worked at the Treasury and also served as deputy governors of the Bank of England.

Osborne’s plan involves half a million public-sector job losses and 18 billion pounds of welfare reductions, a cut of almost 9 percent in the total bill.

He and Cameron argue that their austerity program is keeping interest rates low and securing Britain’s top-grade credit rating. Their balancing act is to assure investors they will meet their targets while persuading voters that the cuts are worth the pain.

To contact the reporter on this story: Gonzalo Vina in Beijing at gvina@bloomberg.net.

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.