Newspaper article The Journal (Newcastle, England)

Benefits Crackdown to Fund PS2bn NHS Lifeline

Newspaper article The Journal (Newcastle, England)

Benefits Crackdown to Fund PS2bn NHS Lifeline

Article excerpt

Byline: Gavin Cordon Reporter

CHANCELLOR George Osborne has thrown a PS2 billion lifeline to the cash-strapped NHS as he signalled a renewed crackdown on benefits if the Tories regain power in next year's general election.

Unveiling the year-on-year increase in spending for frontline NHS services, Mr Osborne said that it had been made possible by the strength of the economic recovery.

But with ministers braced for a further deterioration in the public finances when he delivers his set-piece Autumn Statement on Wednesday, the Chancellor acknowledged that more "difficult decisions" on spending would be needed in the next parliament.

"We have got to make tough decisions in our public expenditure, in our welfare budget, and that is how we can afford these things," he told BBC1's The Andrew Marr Show.

With the Tories committed to PS7 billion in tax cuts - by raising personal allowances for basic and higher rate taxpayers - the Institute for Fiscal Studies warned some government departments could see their budgets slashed by a third in a painful new round of "austerity".

Shadow chancellor Ed Balls accused Mr Osborne of making "unfunded" spending commitments - while at the same time promising a Labour government would allocate another PS2.5 billion a year to the NHS "over and above" the Tory plans, paid for in part by a new "mansion tax" on properties worth over PS2 million.

Mr Balls later caveated his commitment, saying that there would have to be a re-think if it meant unacceptable cuts to benefits.

"If he is doing it through a 10% cut in child benefit, then I will have to think again," he told BBC Radio 5 Live's Pienaar's Politics.

Mr Osborne described the additional funding as a "down payment" on the five-year plan set out by NHS England chief executive Simon Stevens which warned of an PS8 billion shortfall by the end of the next parliament unless action was taken.

Treasury sources said around PS750 million of the PS2 billion annual increase for the NHS services would come from savings made in Department of Health "back office" costs, with the rest coming from other departments. …

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