UK ‘austerity cuts’ to continue into 2018

While the government continues to give away billions of pound of tax payers money in over seas aid -- £12.6 billion by 2014, this Conservative government continues to hit the poorest families the hardest.

In comparison the Police budget is £12.1 billion for police forces around the UK

Today Chancellor George Osborne will set out his autumn budget statement to parliament.

The Financial Times today reports that the era of austerity could last until 2018 as George Osborne is forced to extend spending cuts still further into the next parliament, a respected economic think tank warns.

The Institute for Fiscal Studies (IFS) said that the Chancellor may have to push out the current squeeze on public spending to 2017/18 and find another £11 billion from cuts or tax rises on top of the further £8 billion reduction in welfare spending already mooted.

Having initially planned to eliminate the structural deficit by the time of the next election in 2015, Mr Osborne has already had to signal further real terms cuts of 2.3% in Whitehall spending up to 2016/17 and the slashing of the benefits bill by another £8 billion (at today's prices).

But under the IFS's "relatively pessimistic" scenario for the future of the economy - under which the recent deterioration in growth prospects and tax receipts turns out to be permanent - the Chancellor will be forced to announce even more bad news for British taxpayers if he is to hit his "fiscal mandate".

In a report ahead of Mr Osborne's Autumn Statement next week, the think tank predicts that in any case he is on course to miss his other fiscal target - for national debt to be coming down in 2015/16.

The IFS urged Mr Osborne to instruct the independent Office of Budget Responsibility to do the same in its forecasts because the change would not "directly materially change the long-term outlook for the public finances".

It said that, with borrowing set to reach £133 billion for the current financial year, £13 billion higher than forecast, Mr Osborne may be forced to abandon the 2015/16 debt target.

The IFS suggested Mr Osborne should replace his supplementary fiscal target with something that better encourages "long-run sustainability".