Chancellor George Osborne has unveiled the deepest cuts in public spending in living memory measures that will affect every man, woman and child in the country.
Lifting the lid on the long-awaited Comprehensive Spending Review, he said firm action was necessary to restore “sanity to our public finances and stability to our economy.”
What that means in reality is a total of £81 billion almost three times the entire cost of running Scotland for three years being lopped off UK departmental budgets and a loss of nearly half a million jobs in the public sector and perhaps hundreds of thousands more from private firms that depend on government contracts.
There were fears that as many as 100,000 Scottish jobs could be lost as a direct consequence of Wednesday’s announcements.
Painting a picture of four years of austerity to a packed House of Commons, Mr Osborne said the pain could have been worse.
It had been expected that departmental budgets would be cut by 25%, but because he had found an additional £7 billion of savings from the welfare budget the average cut was 19% less than the 20% savings Labour planned had they returned to power.
The message from the despatch box could not have been more clear.
“Today is the day when Britain steps back from the brink, when we confront the bills from a decade of debt,” said the chancellor, whose machine gun delivery often belied the enormity of what he was saying.
“It is a hard road, but it leads to a better future.”
Mr Osborne told MPs the Conservative-Liberal Democrat coalition government’s action was guided by fairness, reform and growth.
Whitehall staff will take a massive hit, with huge job losses across most departments.
The state pension age will rise to 66 in 2020 six years earlier than had been previously announced.
Higher pension contributions from public sector workers will save £1.8 billion and abolishing Employment and Support Allowance for some categories of claimant after one year will raise £2bn.
The Chancellor confirmed the government is to press ahead with plans to axe child benefit for higher rate taxpayers which he said would save £2.5bn more than he claimed it would when he announced it at the Conservative party annual conference.
However he said there would be no further changes to child benefit, calming fears it might be withdrawn for children over 16.
Another key element is a reduction in the defence budget announced earlier this week.
The Ministry of Defence is facing an 8% cut in spending, which will see 40,000 civilian and military personnel lose their jobs and equipment like the Harrier jump jets and the Ark Royal scrapped.
Mr Osborne also announced that the publicly-funded BBC is to take some of the pain.
It will take over the £340 million-a-year cost of running the World Service and will have the licence fee frozen for six years.
Together the measures represent a real terms 16% cut in the BBC’s budget.
Picture courtesy of of Flickr user conservativeparty.