George Osborne always plays the role of the smiling conjurer who pulls the rabbit out of the hat and steals the scene with aplomb. In his 2015 spending review and autumn statement, the surprise announcement was that cuts to tax credit will not be as stringent as expected – although housing benefit claimers are the losers. Concealed within the chancellor’s hat are cuts of more than 50% in grants to local government and tense optimism about the growth, employment and pay forecasts on which everything depends.
The chart below gives the main winners and losers in the spending review over the period up to 2019-20. Cuts are legion. The winners are the big players – the NHS and pensions – both accounting for about a fifth of total spending – which receive real increases of 3 to 4%.
Pensioners will benefit from the transition to the new flat-rate pension from next April onwards, increasing spending in this area by some 4%.
International development has a 21% increase, although some of the new money will be spent to aid security objectives and some in the UK on Syrian refugees. The new Single Intelligence Account for the security Continue reading