IFS warns over public sector

The Institute for Fiscal Studies has warned that government borrowing will rise, public sector spending cuts will increase. The OECD has also said the UK must do more to boost growth and tackle inequality, which it says are key to economic recovery.

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Public service spending 'could fall by a third' by 2018

The Institute for Fiscal Studies (IFS) has released its Green Budget, outlining the impact of the government's budget plans in the coming years.

Based on its analysis, public service spending in "unprotected" Whitehall departments (health, schools and overseas budget are "protected") could fall by a third between 2010-2011 and 2017-2018. This figure could even reach 35%:

Current spending plans imply an average cut in public service spending of one third across unprotected Whitehall departments, i.e. all excluding health, schools and overseas aid, by 2017–18. If the defence equipment budget were to be added to the list of protected areas then spending in unprotected areas would need to fall by around 35%.

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