Britain’s Finance Minister George Osborne has announced more cuts to the country’s welfare system. The conservative-led government aims to reduce its huge debt.
The year 2014 would become the year of hard truths as the Tory-led government of David Cameron needed to find a further 25 billion pounds (30 billion euros) of budget cuts, British Finance Minister George Osborne said Monday.
Speaking to autoworkers in Birmingham, UK, Osborne said the cuts would primarily affect the British welfare system, in which 12 billion pounds were to be saved in each of the first two years after general elections in 2015.
“If we are to fix our country's problems, and not leave our debts to our children to pay off, then cutting the welfare bill further is the kind of decision we need to make,” Osborne said.
Since the beginning of the economic crisis in 2008, Britain's public debt has swollen dramatically in spite of massive austerity measures taken by the coalition-government of Conservatives and Liberal Democrats. Britain was borrowing 100 billion pounds a year, Osborne noted, and was paying half that money in interest just to service the debt.
Service sector slowing
In 2013, the British economy recorded its strongest expansion since 2007. But a survey, released on Monday showed the country's dominant services sector unexpectedly slowed in December.
Therefore, Osborne warned against complacency including suggestions that the hard part of the job was already done. He also said that the banking system still posed risks to the recovery.
Osborne indicated that pensioners would not be affected by the cuts. At the same time, he failed to comment on calls from members of his Conservative party to cut income taxes more aggressively to spur domestic growth.
uhe/jm (Reuters, AP, AFP)