Autumn statement: George Osborne to announce cuts to fund £5bn spending
This story was widely trailed but it is nonetheless further depressing news about the challenges facing rural local authorities.
George Osborne will announce on Wednesday that he is forcing a fresh spending squeeze on cash-strapped Whitehall departments to fund £5bn worth of investment in schools, transport and science over the next three years.
The Treasury is keen to be seen to heed the warning of the International Monetary Fund that cuts should be focused on day-to-day spending, and the government should boost infrastructure projects that could deliver a long-term return to the economy.
The chancellor will say that departments have been asked to find an extra £1bn cut next year, rising to £2.5bn in 2014-15, from budgets already hit hard by austerity measures. The Treasury has also earmarked £3bn in “underspends” by departments that have cut more rapidly than planned, to be put to use. Osborne and the Treasury chief secretary, Danny Alexander, briefed the cabinet on Tuesday morning on the plans, which will be confirmed in Wednesday’s autumn statement.