New Chancellor set to announce £6bn spending cuts today

New Chancellor, George Osborne, is today set to wield the axe by announcing plans to cut £6.2 billion off the £156 billion deficit this year.

The new Con/Lib coalition Government has said trimming the budget deficit is one of its priorities.

However, Mr Osborne’s predecessor, Alistair Darling, warned that cutting the deficit too quickly could pose a threat to the fragile recovery.

Furthermore, prior to the general election, the Liberal Democrats said such measures could threaten the recovery but have now endorsed the cuts.

Mr Osborne told BBC Radio 4 today: “We’ve identified wasteful government spending this year that we are proposing to cut. That amounts to £6.2 billion.

“Almost all of that will be used to reduce the deficit,” he added.

“We will be using £500 million to invest in apprenticeships, further education and some social housing in a way that is consistent with our coalition partners’ desire to see some of that money invested in the front line,” Mr Osborne said.

The cuts are set to include over £1 billion from advertising, consultancy and other discretionary Government spending such as refurbishment.

More than £500 million will come by reducing the budgets of quangos, or they will be abolished altogether.

There are also set to be thousands of job losses with at least 300,000 Whitehall and other public sector workers to lose their jobs, while 100,000 council workers across the country are expected to face redundancy.

Meanwhile, the Child Trust Fund (CTF) will be scrapped altogether, in a move expected to save £580 million year.

CTFs were introduced by the Labour Government in 2005 and have been available to every child born after September 2002. The Government gives a £250 voucher, rising to £500 in the case of low income families, to all newborn babies.

However, the new Government argues that almost one million families (25%) failed to open a fund for their child in the first four years of the scheme.

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