Despite a huge level of benefit, public service and health cuts in the past four years, Chancellor of the Exchequer George Osborne is not even 50% the way through the governmentís intended public spending cuts, according to the Institute for Fiscal Studies.
The IFS have argued that following the Chancellorís announcement of his intention to continue utilising austerity as the UKís primary economic policy until 2019 that almost 60% of his planned spending cuts are yet to be put into to action.
This would mean than on average, public spending per worker would decrease by 2.4% every year from now until 2018.
Austerity in simple terms is an economic policy that is typically used in adverse financial climates in order for governments to address their budget deficits. This is usually done either through higher taxation, or as in the UK, through spending cuts which in turn will reduce public debt and allow growth to occur easier.
And the IFS has argued that a further 30% of ìunprotectedî public sector budgets could needed to be cut in order for him to adhere to his initial economic goals, warning that the cuts have only just begun.
The merits of the Chancellorís austerity policy have been heatedly debated, with many working class individuals angered by the increased inequality it is creating whilst advocates citing that it is a necessary measure in order for the govermment to achieve a budget surplus in the near future.
Indeed, the IFS have estimated that if the current level of cuts stays in on the same trajectory, that the UK would be able to achieve this budget surplus by 2010, which would mark the first time this has occurred since the 2001.
However, they added that the UKís total national debt would continue to comprise a significantly high 76% of GDP, and that regardless of the scale of cuts , that national debt would remain higher than it was before the recession until at least the 2030ís.
Paul Johnson, the IFS’s director, said: “Returning growth, and forecasts suggesting we should be running a budget surplus by 2018-19, should not lull us into a false sense that all is now well with the public finances.
“The outstanding debt will still be very large and the scale of additional spending cuts required to hit that budget surplus remains hugely challenging, especially on top of cuts already delivered.
“A combination of significant additional spending pledges already made and a growing and ageing population will only add to the challenge.”
ëExpensive and poorly targetedí
The Chancellorís cuts to areas of public spending that have long been valued across the general public has garnered widespread criticism and a huge backlash from people who believe that Britain is moving to a more unequal landscape.
Despite Mr Osborneís pledge to keep health and education safeguarded from any radical cuts, it has still been forecasted that the average amount of money that the NHS will be able to spend per resident will be almost 10% lower in 2019 than it was in 2011.
Carl Emmerson, deputy director of the thinktank, hit out at the Chancellor for applying spending cuts to the all important area of childcare, where there have been multiple calls for government legislation to be implemented in order to help parents get childcare and thus be less restricted in their employment scope.
“Despite the state of the public finances, tax cuts and spending increases are being considered by government and opposition. They seem agreed in promising additional spending on childcare despite a remarkable lack of evidence as to its effectiveness.
“They seem equally set on further cuts in income tax either though more increases in the personal allowance or the introduction of a 10p starting rate. Either could be expensive and would be poorly targeted on the low paid.”
Andrew Goodwin, senior economist at Oxford Economics, said: “The unbalanced nature of the recovery to date emphasises the need to avoid complacency. Nevertheless, we believe that an improving global outlook will provide the basis for the recovery to broaden out this year, by supporting export growth and giving firms the confidence to invest their large cash piles
Clearly the merits of the Chancellorís spending cuts will always be polarising, with those of higher class and income backgrounds likely firmly behind taking positive action in order to address Britainís vastly inflated deficit.
However, it is the manner in which the Chancellor has undertaken these changes, swift, fast and somewhat aloofly that has angered many working class households, who may have been far more damaged financially by benefit cuts than the Chancellor has been led to believe.
With housing costs on the rise, wages stagnant, and prices of daily essentials such as transport and food always on the rise, the Chancellor will need to find a way of improving the living standards of people in the UK before he implements any more radical spending cuts.
Otherwise with the 2015 General Election on the horizon, and Labour utilising populist policy after populist policy to attract voters, he may find himself out of government well before 2019.