£12 bn worth of cuts to be announced in budget
07/07/2015
George Osborne, Chancellor of the Exchequer, has claimed that he has decided how the government will make £12 billion worth of welfare cuts that had been promised in the Conservative Party manifesto.
These cuts will be announced in Osborne’s new budget tomorrow, the first all Conservative budget in more than 20 years. They are expected to include a reduction in the benefit cap and removing subsidies for social housing. The Chancellor has also announced that he would not reduce the top rate of income tax after some Conservative MPs called for a cut.
Under the changes to social housing, local authority and housing association tenants in England who earn more than £30,000 - or £40,000 in London - will have to pay up to the market rent, Mr Osborne will say. The benefit cap will be reduced to £23,000 in London and what is thought to be £20,000 in the rest of the UK.
Osborne has also confirmed that he will be looking to make cuts to tax credits for people on low incomes. He said the low paid would be compensated by tax cuts in an effort to end the "merry-go-round on which people pay their taxes and then get back benefits" and the treasury would also convince firms to pay higher wages.
Osborne and the Conservatives have claimed that the welfare cuts are needed to prevent deeper cuts to public services and to complete the governments goal to eliminate the deficit and run a surplus.
Need financial advice?
If you have any personal finance questions related to this news article, then please contact our financial advisers. You can get in touch by asking a question online, calling us on 0800 092 1245, or by arranging a visit.
Share this..
Related stories
Mervyn King warns next government of tough times ahead
Mervyn King, the governor of the Bank of England, has today suggested that the next UK government would have to make so many controversial cuts in public services that it would be potentially unelectable for decades to come. There is a growing concern that the next UK government could be left holding a poisoned chalice with large-scale public sector investment cuts, job cuts in the public sector a...
Read MoreUK government reveals £60 million funding for north-east economy
In a desperate attempt to revitalise and stabilise the economy of the north-east of England the UK government has today revealed a £60 million taxpayer funded investment into businesses in the region. This comes only days after the closure of a Teeside steel works with the loss of 1700 jobs, a massive blow to a region which has been under pressure for some time. The £60 million being made ava...
Read MoreThe dangers of focusing on the financial sector
The proposed rise in the uniform business rate, which is set to hit the UK retail sector, is the latest in a long line of unhelpful moves by the UK government at a time when the UK banking sector is receiving billions upon billions of pounds of state assistance. There is a growing feeling that too much focus is being placed upon the banking sector to the detriment of every other sector in the UK,...
Read MoreIs the UK Union safe?
The last few weeks have been nothing short of mind blowing with massive well known companies hitting the rocks, billion pound bailouts and probably more trouble further down the line. But what has this done to the Union? Has it strengthened the bond between England, Ireland, Scotland and Wales?
The truth is that aside from the SNP making noises in Scotland the Union was never reall...
Business leaders sign letter endorsing Tories
01/04/2015 The Daily Telegraph has published a letter signed by over 100 company leaders declaring support for a Conservative led government. The letter claims that the company leaders support the Conservatives economic decisions, such as the reduction in corporation tax from 28% to 20%. It also claims that a “change in course” by a Labour government would risk economic recovery. Th...
Read More