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Truss May Need to Match Brutal 2010 Austerity Cuts to Calm Markets

  • UK government under pressure to set out fiscal plans
  • Markets have tumbled since Truss unveiled unfunded tax cuts
Bloomberg business news
Truss Defends Tax Cuts as ‘Right Plan’ for UK
Updated on

Prime Minister Liz Truss is under pressure to cut spending on the same scale as George Osborne’s infamous austerity drive of 2010 in order to stabilize the UK public finances and win back the confidence of investors.

Cuts to benefits, infrastructure projects and departmental spending totaling up to £47 billion ($52 billion) will be needed to bring the national debt under control, comparable to the austerity Osborne imposed during the financial crisis, the Resolution Foundation said. Bloomberg Economics projected the cuts may even need to exceed Osborne’s since borrowing costs have rocketed following the backlash against Truss’s package of tax cuts