PAY CUTS & JOB CUTS! – Civil servants and nurses condemn budget

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Chancellor Gordon Brown delivered his 10th Budget yesterday featuring more tax cuts for the rich and pay cuts for the working class.

Opening his speech to MPs in the House of Commons, Brown claimed: ‘The British economy is strong and strengthening.

‘I can report that inflation is currently two per cent, on target. And in the latest quarter, the economy is growing at an annual rate of 2.5 per cent, on target.’

However he announced plans for ‘official statistics to be the responsibility of an independent board’.

He added: ‘We will continue to be vigilant internationally over global imbalances and oil prices. And we will take no risks with inflation at home.

‘The public sector pay settlements will show settlements averaging just two and a quarter per cent.’

Brown boasted that public spending had been kept down, saying: ‘Net debt is now 47 per cent of national income in France, 47 per cent in America, in Germany 62 per cent, in Japan 83 per cent and in Italy over 100 per cent, but this year in Britain 36.4 per cent.’

Announcing tax cuts for the rich, he said: ‘I will refocus tax incentives for venture capital, with a 30 per cent relief for investments in venture capital trusts.’

He added that the exemption on stamp duty would be raised to £125,000 and the level at which inheritance tax begins to be paid would rise from £275,000 to £325,000.

He said there would be only the normal annual inflation rise of 1p in duty on a pint of beer and 4p on wine but duty on cigarettes would rise 9p.

Armed forces spending on Iraq and Afghanistan will be increased by £800m, and an extra £200m spent on ‘peacekeeping’ elsewhere.

Signalling more cuts in health and safety, Brown said: ‘In the last budget I announced that Britain would pioneer risk based regulation. And today the government publishes our new code based on a legal requirement for inspection only where there is risk.’

He announced further sales of public assets ‘in order to release new resources for our priorities’.

He said that ‘after asset sales reported at £6.3 billion last year, we plan total sales by 2010 of £30 billion’.

Brown boasted: ‘Published today are the figures for the first £6.4 billion of Gershon savings, including a reduction in civil service posts of 40,000.’

At the same time he announced ‘at an additional cost of £100 million we will ensure that by April next year we will more than double the number of community support officers from 6,000 to 16,000.’

He claimed that ‘investing in education is this budget’s choice.’

Preparing the way for ‘trust’ schools, he said that by next year £440 million more will go ‘direct to the school’.

Mark Serwotka, general secretary of the Public and Commercial Services Union (PCS) said: ‘The Chancellor’s intention to go beyond Gershon in the next spending round, by effectively cutting 5 per cent each from the Department for Work and Pensions (DWP), Her Majesty’s Revenue and Customs (HMRC), The Treasury and Cabinet Office will only further damage key public services.’

He added: ‘The intention to drive down public sector pay will do nothing but foster a culture of low pay and leaves little room for manoeuvre in addressing the huge pay inequalities that exist in the civil service.’

Mary Turner, GMB National President said: ‘Gordon Brown should not undo all Labour’s good work so far in public services by trying to impose a wage ceiling of 2.25 per cent on the very workers we all rely on.’

Dr Beverly Malone, General Secretary of the RCN said: ‘Not only are nurses angry about pay, they are deeply concerned about the financial crisis facing the NHS.

‘In Trusts across the country nursing posts are under threat as deficits take hold.’

l Yesterday the Royal Free Hospital announced 500 redundancies.