Leader: Coalition Spending Plans Are Holed Below the Poverty Line

Summary

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BARELY 24 hours after the chancellor has presented the Comprehensive Spending Review as "fair" than the respected Institute for Fiscal Studies has fired two torpedoes. The first casts doubt on George Osborne's analysis of who would feel most of the pain from the cuts. Excluding the wealthiest two per cent of the population, who it assesses will be the hardest hit, it said the plans would be regressive in their impact since those in the bottom half of the income scale would be affected more than those in the top half as a result of cuts to benefits and public services.

The second torpedo is no less question-begging. According to Carl Emmerson, the IFS acting director, such is the unpredictable effect on the economy and future growth, there is a 40 per cent chance that the chancellor will have to come back for bigger tax rises or deeper cuts to public spending and growth. A review of these spending plans, possibly in two years time, would, he says, be "a sensible way to proceed."

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Leader: Coalition Spending Plans Are Holed Below the Poverty Line

It is the attack on the central notion of fairness where the deficit reduction package is vulnerable, and which could potentially derail the package if it causes a large enough number of Liberal Democrat MPs to withdraw their support. While there...

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