Tuesday, 28 May 2013

Agreements reached on spending plans

Source BBC News@ tienganhvui.com


Pound notesThe government will set out its spending plans in full next month


Chancellor George Osborne has reached agreement with seven Whitehall departments on some of the savings the government wants to make in 2015.


Mr Osborne wants to reduce spending for the year by £11.5bn, some of which he says will be earmarked for infrastructure projects.


Full details of the deals he has struck with ministers will not be revealed until next month's spending review.


The opposition is expected to say the government has cut too much too fast.


On a visit to north-west England later, Mr Osborne is expected to announce the departments in question, but the financial details will be held back until the review, which will set out spending for the year from April 2015, is presented to Parliament.


It is understood that taken together the savings agreed so far in talks with departments and in previous announcements mean the Treasury still has to find £8bn of the £11.5bn to be saved in the spending review.


The chancellor will highlight a decision made in the Budget to find extra cuts in Whitehall in order to spend more on infrastructure.


Fractious negotiating

BBC political correspondent Ross Hawkins says the significance of the provisional agreements will become clear only once Mr Osborne reveals which departments have signed up and it is known whether the list includes the biggest and most politically significant Whitehall spenders.


The figures suggest there is plenty of fractious negotiating between departments and coalition partners still to be done, he added.


Mr Osborne has indicated there will be no support for a second Crossrail scheme for London in the spending review.


He believes work on the current £16bn Crossrail project should be completed first, in 2018, before he considers further major transport schemes for London.


Earlier this month, the Commons Public Accounts Committee warned the UK may not be able to afford projected levels of spending on military equipment over the next decade.


Its report was based on a government pledge for a 1% increase in defence spending in the review, and in following years.





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