UK Finance Minister Rachel Reeves announced plans to cut government operational costs by 15 percent within four years as she grapples with strained public finances.
Her comments came ahead of her crucial Spring Statement on Wednesday when she is expected to detail billions of pounds of spending cuts across various government departments.
“We are, by the end of this parliament, making a commitment that we will cut the costs of running government by 15 percent,” she told the BBC.
The BBC reported that the target would lead to annual savings of £2.2 billion ($2.8 billion) across Britain’s civil service, which employs more than 500,000 people.
Reeves said it would be up to individual departments to decide how many civil servants will lose their jobs but added that personnel could be cut by 10,000.
“I would rather have people working on the front line in our schools and our hospitals, in our police, rather than in back-office jobs,” she told Sky News.
Reeves also insisted that she will stick to her own fiscal rules when she delivers her financial update on Wednesday.
They are not to borrow to fund day-to-day spending and to see debt fall as a share of the gross domestic product by 2029-2030.
Since she has also committed to not increasing taxes, sticking to the rules raises the prospect of spending cuts to some departments.
The Labour government has failed to get Britain’s economy firing since it swept to power last July, a task complicated by Donald Trump’s return to the White House.
“The world has changed,” Reeves told Sky.
“We can all see that before our eyes, and governments are not inactive in that –- we’ll respond to the change and continue to meet our fiscal rules.”
Official data released on Friday showed that public sector net borrowing — the difference between spending and tax receipts — grew last month, leaving Reeves with little wiggle room to meet her rules.
The restrictions are designed to ensure that the government’s spending plans maintain credibility in financial markets.
On Tuesday, the government announced contested cuts to disability welfare payments, hoping to save more than £5 billion annually by the end of the decade.
Reeves insisted Sunday that there would still be “real-terms” increases in total public spending in every year of this parliament, which is due to end in 2029.
AFP
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