U.K. Chancellor of the Exchequer George Osborne raised the prospect of further cuts to welfare if his Conservative Party wins the 2015 general election.
“Welfare spending cannot be excluded from the difficult decisions that have to be made,” he told Parliament’s Treasury Committee in London today. “We’re going to have to find billions of pounds more in welfare savings to reduce the deficit, get debt falling and invest in education and science and the things that matter to our future.”
The Institute for Fiscal Studies said last week a further 12 billion pounds ($20 billion) of welfare reductions are needed to avoid deeper cuts to government departments’ budgets between 2016 and 2019. Without squeezing welfare, the amount spent on public services would have to fall to its lowest as a share of national income since 1948, the London-based research group said.
“I agree with the analysis that many billions of pounds are going to be required if we want to avoid cutting government budgets further than they have been,” Osborne told lawmakers. “Anyone who wants to be honest” has to confront that fact, he said.
In his Autumn Statement on Dec. 5, Osborne set out plans to return the budget to surplus in 2019 for the first time since 2001. He has cut welfare by more than 20 billion pounds since taking office in 2010 and is proposing to introduce a cap on 100 billion pounds of social-security spending, excluding state pensions.