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SPENDING REVIEW 2013: Initial cuts unveiled 26 June 2013

Chancellor of the Exchequer George Osborne has confirmed he is cutting the budgets of the Treasury, Local Government Resources and the Cabinet Office by 10%.

The Ministry of Justice has also been told it is expected to make savings of 10% in the financial year 2015/16 by the Chancellor of the Exchequer, while the Department for Business, Innovation and Skills will face a budget cut of 6% in 2015/16.

The Department for Energy and Climate Change see its budget reduced by 8% and the Department for the Environment, Food and Rural Affairs by 10%.

He also confirmed that Council Tax will be frozen for a further two years. Mr Osborne said this demonstrated his commitment to those who “work hard to get on”.

Today’s move means that the Communities budget has now been cut by around 50% in real terms since 2010.

In total the cuts to budgets and savings plans totalled £11.5bn for the financial year 2015/16, the Chancellor said.

As he announced that administrations in Scotland, Wales and Northern Ireland would have to make savings of 2% in their budgets, he said it was important that these communities had “more control over their own destiny.”

In addition Northern Ireland, Scotland and Wales will also find a reduction in their budgets of 10%.

The defence resource budget will be maintained in ‘real terms’. The civilian workforce will continue to be reduced, however, along with their allowances and there will be an overhaul of defence purchasing. The defence equipment budget will increase overall by 1% in 2015/16.

The Chancellor claimed that the £38 billion gap in defence spending that the coalition government inherited has now been plugged.



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