1.3m jobs 'could go due to spending cuts', report says

Cuts announced in the Budget could lead to up to 1.3 million jobs being lost by 2015, a newspaper report claims.


The Guardian says leaked Treasury figures predict that up to 120,000 public sector jobs and 140,000 private sector jobs could disappear annually for the next five years.

Labour figures said the true cost of George Osborne's Budget was now clear.

But the government said independent experts expect "unemployment to fall in every year and employment to rise".


The Guardian says the figures come from a slide which was part of a Treasury presentation on the Budget.

It claims the Chancellor would have seen the presentation before delivering his Budget last week.

A Treasury spokesman said on Tuesday night that the department could not immediately confirm or deny whether the slide was genuine.

'Wishful thinking'

Mr Osborne announced real terms cuts across all government departments of 25% over four years - except health and foreign aid which are ring-fenced.

He did not say how many public sector jobs were expected to go - but the government has previously insisted that the bulk will come from not filling vacant posts, rather than by making redundancies.

At the same time, the government is predicting that 2.5 million jobs will be created as a result of private sector growth by 2015.

But TUC general secretary Brendan Barber said that was "absurd", given the reduction in the availability of government contracts and the likely fall in public spending as a result of the austerity measures.

"This is not so much wishful thinking as a complete refusal to engage with reality," said Mr Barber.


"Much more likely are dole queues comparable to the 1980s, a new deep north-south divide and widespread poverty as the Budget's benefit cuts start to bite."

In response to the Guardian story, the Treasury cited a report by the independent Office for Budget Responsibility, set up by Mr Osborne, which predicts that unemployment will peak this year at 8.1% and then fall in each of the next four years to reach 6.1% in 2015.

But shadow chancellor Alistair Darling said that "far from being open and honest", the Chancellor had "failed to tell the country there would be very substantial job losses as a result of his Budget".

"The Tories did not have to take these measures. They chose to take them," Mr Darling said.

"They are not only a real risk to the recovery but hundreds of thousands of people will pay the price for the poor judgment of the Conservatives, fully supported by the Liberal Democrats."

sourced from The BBC