Senior government figures are urging the UK Chancellor George Osborne to slow the pace of his planned £12bn welfare spending cuts.
Press TV report:
Amid concerns that the chancellor will have to target child tax credit as part of his plan, Osborne has been called to suffer a “bit of a loss of face” to avoid damage on the party that secured a majority in parliament.
Osborne is likely to unveil details of the cuts in his budget next month. Before elections, he already announced that there is need to cut £12bn from the welfare budget by 2017-18 in order to pave the way for an overall surplus by 2018-19.
But some party insiders believe that Osborne’s spending plans will force him to slash child tax credits and therefore could inflict “enormous damage” on the Tories by hitting the working poor.
“The government and the European political elites are completely false and outdated economic understanding. They essentially rely on increasing debt and shifting that to one percent and then expecting from the one percenter to spend their money which they never ever do. Osborne is an outdated, perverted and corrupt economist as and what he knows to do is to put in austerity which very fundamentally withdraws demand from the economy for the benefit of the rich”, Rodney Shakespeare, a Professor of Binary Economics told Press TV.
The UK government initiated its austerity program back in 2010 with a series of cuts in public spending. The main goal was to reduce the budget deficit in the five-year period. However, the Treasury extended the proposed austerity period until at least 2018 amid the public apathy.
The new pressure on Osborne is building after Prime Minister David Cameron severely restricted the room for maneuver on welfare cuts. Cameron’s move during the election campaign left the pension department with no choice but to look at taking the axe to tax credits, including child tax credits, and housing benefit.
Blocking child benefit changes means the proportion of the non-pensioner part of the welfare budget needing cuts has increased from 10% to more than 20%.
“There’s now a glimmering among the people, the electorates in the UK that they made a mistake in the elections. They elected Conservatives simply because they panicked, the last minute panic about Scottish independence. This weekend, there’s going to be a huge demonstration as this not only hit the poor but it crucially withdraws demands”. Shakespeare concluded.
The British media disclosed the battle within the party as the prime minister faces the prospect of a Tory split over the EU referendum and his plan to scrap the Human Rights Act.
The reports quoted Philip Hammond, the foreign secretary, saying jokingly at a recent meeting that the government could kill two birds with one stone in two key areas – the EU negotiations and the £12bn welfare cuts – by denying all UK workers the right to claim tax credits for their first four years in work.