Peter Hoskin

Spending review live blog 

1350, PH: And that’s Johnson finished now. Osborne is responding, but we’ll leave the live blog there. Plenty more coverage on Coffee House soon.

1348, PH:
Johnson claims that Osborne’s final point about 19 percent departmental cuts is misleading. He goes on to say that Labour would now cut departmental budgets by half the amount.

1346, PH: Labour’s method for deflecting the increase in the NHS budget is taking shape: Johnson claims that it will be swallowed by a “wasteful” reorganisation of the service.

1342, PH: Now Johnson is focussing on the figure of 490,000 public sector job losses. He says that welfare cuts will make it harder for them to find employment.

1342, PH: More gags than graphs from Johnson, at the moment.

1341, PH: Johnson observes that the people of Wales, Northern Ireland and Scotland don’t back the cuts – “perhaps that’s why [Osborne] calls himself a One Nation Tory.”

1339, PH: A jokey response from Johnson. He enjoys, as he did last Monday, pointing out that Osborne supported Labour’s spending plans until November 2008.

1338, PH: Johnson is pushing one of Brown’s favourite lines: that we had the second lowest deficit in the G7 at the start of the financial crisis – shame we’ve got the largest one now.

1337, PH: Here’s Johnson’s new line: that the government are “deficit deceivers”.

1335, PH: Johnson says that we’re going to see the “deepest cuts in living memory,” and that some of the government “want” this on ideological grounds.

1334, PH: And here’s the actual finish. “A stronger Britain starts here,” Osborne wags. Now it’s Johnson’s turn…

1332, PH: Osborne says that the average departmental cut will be smaller than the one that Labour accounted for in their Budget: 19 percent rather than 20 percent. This figure will need some looking at.

1331, PH:
Osborne concludes: “The decisions we have taken today bring sanity to our public finances and stability to our economy.” He emphasises saving made through cuts to waste and welfare.

1330, PH: Overall, Department of Education faces cuts of 1 percent a year.

1329, PH: £2.5 billion pupil premium.

1328, PH:
The Chancellor freely admits that rising money for schools means that “other departments will face bigger cuts”. Schools budget will rise from £35 billion to £39 billion.

1326, PH:
Osborne confirms Crossrail, and the M25 will be widened too.

1325, PH: Osborne: “Even after these tough spending settlements, the country will still be spending over £700 billion a year.”

1324, PH:
£30 billion to be put into transport infrastructure projects – “More,” Osborne says, “than was spent over the last 4 years.”

1323, PH: Osborne confirms the BBC funding deal that we heard about yesterday evening: the licence fee will be frozen for the next six years, BBC will take over funding of World Service, S4C, etc. This is equivalent to a 16 percent cut for the BBC, says Osborne.

1322, PH:
Osborne claims that cuts to arts quangoes are being done to “limit” cuts faced by arts institutions to 15 percent a year.

1321, PH: Defra faces cuts of 8 percent a year.

1320, PH: Green investment bank, wind farms, etc.

1318, PH:
The science budget will be protected at £4.6 billion a year. We’re hearing a lot about what has escaped the cuts.

1317, PH: Vince loking pensive as his department’s cuts are read out. 7.1 percent, mostly administrative.

1315, PH: £1.5 billion for the “victims” of Equitable Life.

1314, PH:
A loan for people in Northern Ireland who lost their savings as a result of financial crash.

1313, PH: The NHS will have to find savings of £20 billion a year – but it is still protected from the cuts, natch.

1311, PH:
A whole range of universal benefits, including Winter Fuel Allowance, will be kept as they were. Hm. Slightly undermines the coalition’s argument that it is unfair for low income earners to pay towards child benefit for high income earners.

1310, PH: Child benefit changes will save £2.5 billion – over double the £1.1 billion that was quoted at the Tory conference.

1310, PH:
No further changes to child benefit other than the one that was announced at the Tory conference (i.e. removing the benefit from high rate taxpayers). A slight surprise this: there was noise about child benefit stopping when children hit age 16 (rather than 18).

1310, PH:
Child tax credit will be up by £30 next year. Nick Clegg nods eagerly.

1307, PH:
A rat-a-tat, but detailed, account of welfare savings – that will be easier to fathom once we get our hands on the book. A cheer from the Tory benches as Osborne announces the cap on benefits that non-working families can receive. Employment and support allowance will be limted to one year.

1306, PH:
Osborne: “We will be seeking substantial savings, on top of those laready announced, from the £200 billion welfare bill.” Here we go…

1305, PH: Osborne’s onto IDS’s Universal Credit now, he says. £2 billion will go towards it, he claims. “The guiding principle will be that work always pays.”

1303, PH: No more final salary pensions for MPs.

1302, PH: State pension age will rise to 66 by 2020. On public sector pensions, Osborne says he agrees with John Hutton that there needs to be higher contributions – and that these should be staggered so that higher public sector earners pay more. The government will decide on measures once Hutton reports in the spring.

1301, PH: Osborne claims that, in cash terms, the better off will be hit by these measures more than the least well-off. This is the kind of analysis that set up an alternative analysis from the IFS a few months ago.

1300, PH: An extra £900 million to tackle tax evasion and fraud – Osborne says this should pull in £7 billion.

1259, PH:
We’re properly into the bank section. Levies, a code of conduct, etc.

1257, PH: The Blame Labour theme is going strong. Osborne says that he can “understand why the public are angry with the banks that the previous government didn’t regulate properly.”

1257, PH: A stuttering cough has entered Osborne’s delivery.

1256, PH: Osborne says that there is “nothing fair about running huge deficits,” and quotes one Gordon Brown to the effect that bad public finances affect the poor the most.

1255, PH:
Good rheotoric and policy from Osborne. “Reform is one of the guiding principles of the spending review,” he says. Departments will have to reduce reform-inclined business plans, so that the public can hold them to account.

1254, PH: Justice department will face cuts of 6 percent a year. Law officer’s department to lose 24 percent over the Parliament.

1253, PH:
Police spending will fall by 4 percent a year. Osborne claims that this will be summed from cuts to administration and bureaucracy.

1252, PH: Osborne: “No public service can avoid reform.”

1251, PH: The international aid budget will rise to £11.5 billion – helping to halve malaria deaths. Osborne says that we, as a country, can “hold our heads high.”

1250, PH:
Rents won’t change for current social housing tenants – but subsidy will be restricted for new tenants. Osborne then mentions planning laws and a “new homes bonus” – this doesn’t make much sense until we see the actual document.

1248, PH: One of Osborne’s goodies: an extra £2 billion for social care.

1247, PH: Osborne says that there will be a “massive devolution” of financial policy. Not only is that localism in action, but it means that councils will get more responsibility for the cuts.

1246, PH: Good post-bureaucratic stuff from Osborne, as he says the government will expand the use of personal budgets – in many cases, this produces more tailored results at lower costs.

1244, PH: We’re all in this together – even the Queen. Osborne confirms that Royal household spending will go down by 14 percent.

1243, PH: Laughter from the Labour benches as Osborne mentions funding for Big Society projects.

1243, PH: There’s the OBR figure – 490,000 public sector job losses – but Osborne stresses that more jobs will be created, and that many of the losses will come because of natural turnover.

1242. PH:
These are quite sweeping cuts to Whitehall waste that Osborne’s cutting out. The government previously planned to cut £3bn from departmental administrative budgets – now, he says, it will be £6bn. The Treasury budget will be cut by a third.

1241, PH:
Osborne claims that the spending review is guided by fairness, and that “the broadest shoulders will bear the greatest burden.”

1239, PH: Capital spending will be £2 billion higher each year.

1238, PH: Osborne’s getting in to the meat now. He says the (erm, fictional) “Department for Debt Interest” will be one of the biggest losers – losing £5bn over the course of the Parliament. This, Osborne points out, “could pay for 16 hospitals”. 

1238, PH: Claim that current spending totals will be the same as they were in the Budget.

1236, PH: The Chancellor stresses that the government will not shy away from the task: “We will not return to the brink of bankruptcy”

1234, PH:
Osborne is concentrating on the government’s new favourite case of for the cuts: that we are paying £120 million a day in debt interest.

1233, PH: The words “necessary” and “unavoidable” have already cropped up a few times. Osborne is speaking with a determined staccato.

1232, PH:
Osborne stands up and immediately sets the tone: “Today is the day we come back from the brink.”

Stay tuned for live coverage from 1230

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