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| George Osborne delivering his speech to the Tory faithful |
George Osborne said today the government would cut the welfare bill by a further 10 billion pounds over the next year as it seeks to tame a massive deficit. Chancellor of the Exchequer Osborne told the Conservative party's annual conference, in Birmingham, that it was unfair that people in work should earn less than those without jobs.
He also ruled out a so-called "mansion tax" on big houses, a move favoured by the Liberal Democrats though he insisted the wealthy would continue to bear the greatest burden. "The great bulk of savings must come from cutting government spending, not raising taxes," Osborne told delegates in the central English city of Birmingham.
"We have to find greater savings in the welfare bill, £10 billion of welfare savings by the first full year of the next parliament."Osborne indicated that young unemployed people were likely to see reduced housing benefit, while there would be other cuts across the board in Britain's welfare system. "How can we justify that people in work have to weigh up the costs of having another child when those out of work don't?" Osborne added.
The reductions are in addition to the 18 billion pounds in welfare cuts that are already planned by 2015 by the coalition. The Liberal Democrats are opposed to further welfare cuts unless new wealth taxes are also introduced. The Deputy Prime Minister Nick Clegg has said: "Nothing in detail has been agreed on further cuts or savings to welfare" The coalition promised to cut Britain's record deficit when it was elected in 2010 but it has struggled with a double-dip recession in the world's seventh largest economy.
Rachel Reeves MP, Labour’s Shadow Chief Secretary to the Treasury, responding to George Osborne's speech to the Conservative Party conference, said:
"George Osborne’s speech shows he is in complete denial about the failure of his plan. His defensive speech didn't once mention that his policies have seen a double dip recession, one million young people out of work and, as a result, the deficit going up by 22 per cent so far this year. And he failed to mention growth or set out any policies to deliver the jobs and growth we need to get the deficit down.
“The reason why George Osborne has been forced to talk about billions more cuts into the next Parliament is because his failure to deliver economic growth means he will break his promise to balance the books by 2015. There do need to be savings in the welfare budget, but the benefits bill is soaring under this Government because unemployment is so high.
“He will never be a One Nation Chancellor when he is pressing ahead with a tax cut for millionaires while asking millions of pensioners and families to pay more. And while he talked about work incentives his deep cuts to tax credits have left thousands of working parents better off if they quit their jobs."
As a point of clarification, although we published Ms Reeves comments in full, the national debt is rising by 22% and not the deficit as Ms Reeves has claimed.
Rachel Reeves MP, Labour’s Shadow Chief Secretary to the Treasury, responding to George Osborne's speech to the Conservative Party conference, said:
"George Osborne’s speech shows he is in complete denial about the failure of his plan. His defensive speech didn't once mention that his policies have seen a double dip recession, one million young people out of work and, as a result, the deficit going up by 22 per cent so far this year. And he failed to mention growth or set out any policies to deliver the jobs and growth we need to get the deficit down.
“The reason why George Osborne has been forced to talk about billions more cuts into the next Parliament is because his failure to deliver economic growth means he will break his promise to balance the books by 2015. There do need to be savings in the welfare budget, but the benefits bill is soaring under this Government because unemployment is so high.
“He will never be a One Nation Chancellor when he is pressing ahead with a tax cut for millionaires while asking millions of pensioners and families to pay more. And while he talked about work incentives his deep cuts to tax credits have left thousands of working parents better off if they quit their jobs."
As a point of clarification, although we published Ms Reeves comments in full, the national debt is rising by 22% and not the deficit as Ms Reeves has claimed.
