More austerity seems inevitable – but the Chancellor faces a tough task to find sensible ways to cut spending in next week’s budget. The first challenge in making further cuts is that he has pledged to protect a number of areas of spending. Manifesto commitments ruled out cuts to health, schools, overseas aid or pensioner benefits, while concessions to Conservative backbenchers have ruled out cuts to defence or in-work benefits. In November’s Spending Review, the Chancellor went further and ruled out cuts to the security services and policing. The result is that a large chunk of spending now lies beyond the reach of the Chancellor’s knife. The second challenge for George Osborne is that departments are already struggling to implement his existing plans: in the first six months of 2015/16, 10 out of 16 government departments were already spending more than implied by their annual plans. The biggest overspend is at the Department of Health (an extra £885m). Many of the unprotected departments where the Chancellor will look for reductions are already struggling to keep pace with existing spending plans. The MoJ, tasked with cutting its spending by 12%, has reached the halfway point of the year having achieved only […]

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