TOP INDEPENDENT analysts attacked the chancellor’s spending plans yesterday for giving too little data to be useful, hiding the facts and shuffling around spending budgets in a way that stops meaningful comparisons with earlier numbers.
The Institute for Fiscal Studies (IFS) suggested that some key plans only come in after 2015’s election to dodge unpopularity due to spending cuts.
And it expects the government will need another £25bn to fill a hole in the finances from 2016 to 2018, most likely from £6bn of tax rises and £19bn more spending cuts. “The documentation accompanying the spending review announcements was woeful,” said IFS head Paul Johnson. “Publishing such a small amount of information with little explanation is not an exercise in open government.
Meanwhile, the IFS believes Osborne will have to make more cuts to keep on top of the finances.
A £6bn rise in taxes is needed in the years 2016-17 and 2017-18 if the government wants to keep to its plan on the deficit reduction with 20 per cent from tax hikes and 80 per cent from spending cuts. That £6bn is equivalent to adding one percentage point to VAT, the IFS estimated.
The Treasury responded that in publishing a distributional analysis and equalities analysis it had gone further than previous governments.