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Austerity budget to cost 1.3 million jobs in UK

Austerity budget to cost 1.3 million jobs in UK
PTI
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First Published: Wed, Jun 30 2010. 04 29 PM IST
Updated: Wed, Jun 30 2010. 04 29 PM IST
London: An estimated 1.3 million jobs, across Britain will be lost in next five years owing to the spending squeeze announced in the new UK Budget, a leaked Treasury report has revealed.
An assessment by the Treasury officials, which was allegedly leaked to the Guardian newspaper, have shown that cuts in the new budget will cost around 600,000 jobs in the public sector, and about 700,000 jobs in the private sector by 2015.
The emergency budget announced by UK Chancellor George Osborne revealed a number of spending cuts and increased tax rates, including a rise in the VAT rate to 20% and a levy on bank profits.
To meet UK’s public deficit the new budget unveiled 25% cut in expenditures across all government department.
However, the Treasury report also estimated that around 2.5 million jobs will be created by 2015 in the private sector. Osborne has predicted that unemployment rate will fall from 8.1% this year to 6.1% by 2015.
The figures that were displayed in the Guardian were contained in a presentation inside the Treasury the week before the Budget but a spokesman refused to confirm the authenticity of a slide that contained the information.
“The Office for Budget responsibility forecasts unemployment to fall in every year and employment to rise,” the spokesman said.
“The Tories did not have to take these measures. They chose to take them. They are not only a real risk to the recovery but hundreds of thousands will pay the price for the poor judgment of the Conservatives, fully supported by the Liberal Democrats,” Shadow Chancellor Alistair Darling said.
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First Published: Wed, Jun 30 2010. 04 29 PM IST