Spending cuts to be deepest since 1970s, IFS says

The next government will face tough budget decisions, the IFS warns The UK faces the deepest spending cuts since the late 1970s if the three main parties are to meet their budget commitments, new analysis suggests. The years between 2011 and 2015 must see the largest cuts since 1976-80, according to a report from the Institute for Fiscal Studies (IFS). Its estimates suggest the Conservatives would need to make the biggest cuts. Meanwhile a Labour government would see the biggest tax rises, the think tank predicts. Based on commitments made so far, the Liberal Democrats would need to cut an accumulated £51bn from spending on public services by 2017. Labour's plans would require a slightly smaller cut during that time of £47bn, the IFS said, while the Conservatives would cut by the largest amount - £57bn.

Tax rises expected Conservative plans would "imply cuts to spending on public services that have not been delivered over any five-year period since the Second World War". Tax increases would be highest under Labour, the analysis suggests, totalling £24bn over the course of the next parliament. More than halfway through this election campaign, the three largest parties have still given us only a small hint of what they would do

Stephanie Flanders

BBC economics editor

Read Stephanie's thoughts in full £17bn of these have already been announced, leaving £7bn unaccounted for. But the IFS said Conservative plans to raise taxes by £14bn looked optimistic, given the party's commitment to scrap a rise in national insurance, and added that a further rise of £3.5bn would be necessary. The Liberal Democrats' plans to raise taxes by £20bn matched the party's current budget plans, the IFS said, but it meant they would have to make the harshest cuts later on in the parliament. In presenting the report, the IFS director, Robert Chote, criticised all three parties for failing to spell out their budget plans more clearly to voters. "Given that this fiscal repair job is likely to be the major domestic policy challenge for the next government, it is striking how reticent all three main UK parties have been in explaining how they would confront the task," he said. The IFS also said government borrowing over the next few years would be broadly similar for the three major parties.



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