Own up over cuts, says IFS

THE MAIN political parties are preventing voters from making an “informed choice” at the general election by refusing to explain how they will reduce the country’s yawning £163bn budget deficit, according to a leading economic think-tank.

The Institute of Fiscal Studies (IFS) said repairing the parlous public finances will dominate the next government’s agenda, but that Labour, the Tories and the Liberal Democrats had refused to say how they will make the necessary savings.

Robert Chote, the director of the IFS, accused all three parties of “misleading” the public by claiming that spending cuts could be made through relatively painless efficiency savings. Labour has identified just an eighth of the cuts it needs to make, the Conservatives have outlined less than a fifth and the Lib Dems have identified about a quarter of their cuts, the IFS said. Both Labour and the Tories will have to raise taxes in the next parliament, the IFS said. The Tories will have to announce an extra £3bn a year in tax hikes, while Labour will need to raise taxes by £7bn a year.

The Tories plan to get rid of “the bulk of the structural deficit” in the next parliament, using a formula of 20 per cent tax rises and 80 per cent spending cuts. Labour and the Lib Dems are planning to cut spending by £47bn and £51bn respectively.