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| George Osborne says deficit can be eradicated without further tax rises | George Osborne says deficit can be eradicated without further tax rises |
| (35 minutes later) | |
| The government can eradicate the deficit without further tax rises after the next general election, the chancellor, George Osborne, said. | The government can eradicate the deficit without further tax rises after the next general election, the chancellor, George Osborne, said. |
| Osborne was speaking to MPs on the Treasury select committee after the Institute for Fiscal Studies warned that tax rises were inevitable if spending cuts are not to be increased substantially. | Osborne was speaking to MPs on the Treasury select committee after the Institute for Fiscal Studies warned that tax rises were inevitable if spending cuts are not to be increased substantially. |
| The IFS warned last week that Osborne would have to raise taxes by £6bn after the election if Osborne was to keep to his existing rule of financing 80% of the government's deficit reduction from cuts and 20% from tax rises. | The IFS warned last week that Osborne would have to raise taxes by £6bn after the election if Osborne was to keep to his existing rule of financing 80% of the government's deficit reduction from cuts and 20% from tax rises. |
| But Osborne told the Treasury select committee that the 80/20 split, announced when the coalition came to power in 2010, was only ever a "guide" rather than a firm commitment, suggesting the tax element could fall lower. | |
| His insistence on no tax rises will pose difficult questions for the Liberal Democrats because, like Labour, they support the introduction of new taxes, primarily a mansion tax. The difference between the two parties currently in coalition is likely to make it more difficult for them to cut a deal if there is a hung parliament after 2015. | His insistence on no tax rises will pose difficult questions for the Liberal Democrats because, like Labour, they support the introduction of new taxes, primarily a mansion tax. The difference between the two parties currently in coalition is likely to make it more difficult for them to cut a deal if there is a hung parliament after 2015. |
| Osborne told the committee: "The further consolidation after 2015/16 is built into the tables as a spending reduction. I am clear that tax increases are not required to achieve this. It can be achieved with spending reductions." | Osborne told the committee: "The further consolidation after 2015/16 is built into the tables as a spending reduction. I am clear that tax increases are not required to achieve this. It can be achieved with spending reductions." |
| The chancellor also announced he was going to ban the briefing of budgets and autumn statements to newspapers and broadcast media before official announcements, and said an announcement on a married couples tax allowance would be included the autumn statement. | |
| He claimed opposition to his deficit reduction plan is collapsing. Seeking to set out one of the main dividing lines for the next election, the chancellor said he suspected Labour was planning big tax increases if it regains power in 2015. | He claimed opposition to his deficit reduction plan is collapsing. Seeking to set out one of the main dividing lines for the next election, the chancellor said he suspected Labour was planning big tax increases if it regains power in 2015. |
| Osborne was notably warm to coalition politics, saying the Conservatives would have been paralysed if they had formed a minority government after the 2010 election. They would not have been able to achieve a tenth of what they had achieved in coalition. | Osborne was notably warm to coalition politics, saying the Conservatives would have been paralysed if they had formed a minority government after the 2010 election. They would not have been able to achieve a tenth of what they had achieved in coalition. |
| The chancellor came under pressure over whether he understood the pain his welfare reforms might have on ordinary people. In reply to a question, he said: "No, I have not visited a food bank." | The chancellor came under pressure over whether he understood the pain his welfare reforms might have on ordinary people. In reply to a question, he said: "No, I have not visited a food bank." |
| He denied their use would increase as a result of his plan to delay unemployment benefit for seven days. He said food banks were increasing because of greater public awareness of their existence. | He denied their use would increase as a result of his plan to delay unemployment benefit for seven days. He said food banks were increasing because of greater public awareness of their existence. |
| "I think one of the reasons there has been increased use of food banks is because people have been made aware of the food bank service through local jobcentres. I don't see that's a bad thing. It's a good thing that those services are advertised in jobcentres." | "I think one of the reasons there has been increased use of food banks is because people have been made aware of the food bank service through local jobcentres. I don't see that's a bad thing. It's a good thing that those services are advertised in jobcentres." |
| Figures released on Thursday by the Trussell Trust show three times as many people received emergency supplies from its food banks in the three months from April compared with the same period last year. | Figures released on Thursday by the Trussell Trust show three times as many people received emergency supplies from its food banks in the three months from April compared with the same period last year. |
| Delays and changes to benefit payments accounted for more than half of the referrals, it said. | Delays and changes to benefit payments accounted for more than half of the referrals, it said. |
| Osborne declined to set a target for public spending as a proportion of GDP, which currently stands at 44.4% and is due to fall to 40.5% by 2017. | Osborne declined to set a target for public spending as a proportion of GDP, which currently stands at 44.4% and is due to fall to 40.5% by 2017. |
| But he said that any country that allowed the level to rise "sharply" above 40% had historically got itself into trouble, and described the level of almost 48% which he inherited from Labour as "totally unsustainable". | But he said that any country that allowed the level to rise "sharply" above 40% had historically got itself into trouble, and described the level of almost 48% which he inherited from Labour as "totally unsustainable". |
| Osborne defended the ringfence on some departmental spending, saying that it was an expression of the nation's values. It was "a political expression of what the government wishes to achieve and the support it wants to give to society". | Osborne defended the ringfence on some departmental spending, saying that it was an expression of the nation's values. It was "a political expression of what the government wishes to achieve and the support it wants to give to society". |
| He said he was proud of the commitment to keep aid spending at 0.7% of GDP, and did not believe that it had a significant impact on the money available to other departments. | He said he was proud of the commitment to keep aid spending at 0.7% of GDP, and did not believe that it had a significant impact on the money available to other departments. |
| It was "not unreasonable" to increase spending on the NHS in real terms at a time when the population was ageing. | It was "not unreasonable" to increase spending on the NHS in real terms at a time when the population was ageing. |
| He also announced he was going to ban pre-release briefing of budgets and autumn statements to newspapers and broadcasters. | He also announced he was going to ban pre-release briefing of budgets and autumn statements to newspapers and broadcasters. |
| He confirmed that business secretary Vince Cable and defence secretary Philip Hammond had attempted to ease the burden of cuts on their departments by transferring responsibility for medical research and training and army medicine into the health budget. | He confirmed that business secretary Vince Cable and defence secretary Philip Hammond had attempted to ease the burden of cuts on their departments by transferring responsibility for medical research and training and army medicine into the health budget. |
| But he said he rejected this proposal. | But he said he rejected this proposal. |
| The government intends to "live by its commitment" to pensioners to protect the value of their state pension with a "triple lock", said the chancellor. | The government intends to "live by its commitment" to pensioners to protect the value of their state pension with a "triple lock", said the chancellor. |
| But he made clear that the state pension age could rise beyond 67 in the future, as a result of a mechanism built into the pensions bill introducing regular reviews of the impact of increasing life expectancy. | But he made clear that the state pension age could rise beyond 67 in the future, as a result of a mechanism built into the pensions bill introducing regular reviews of the impact of increasing life expectancy. |
| Osborne also foreshadowed big changes in the school spending formula. He pointed out that children from deprived backgrounds received £1,700 less funding in Northamptonshire than Derbyshire. |