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Osborne sets out spending cuts

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QUANGOS, CIVIL service recruitment and perks were today bearing the brunt of the coalition Government's first wave of £6.2 billion spending cuts.

QUANGOS, CIVIL service recruitment and perks were today bearing the brunt of the coalition Government's first wave of £6.2 billion spending cuts.

Chancellor George Osborne outlined where the axe will fall this year, announcing a "bonfire of the quangos" to claw back £513 million, and a freeze on new civil servants saving £163 million. Underused call centres and helplines hundreds of which have never taken a call will be culled.

Other waste, such as spending on in-house newsletters, first class travel, taxi fares and government cars will also be cut, with ministers and civil servants told to use cheap public transport or walk instead.

About £125 million is expected to be saved on taxis, £320 million on hotels and £70 million on flights.

Compulsory

Up to 300,000 public sector jobs could go as part of the assault on Whitehall extravagance to tackle Britain's £156 billion deficit.

Mr Osborne said most of the savings will be used to reduce the national debt, with some £500 million "recycled" to avoid some of the rise in National Insurance next year and to boost employment and skills.

He insisted the "great majority" of reductions in headcount would be met through not filling vacancies, rather than compulsory redundancies.

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Mr Osborne said there was "no money left", but added: "We inherited an economic mess, but we can come out of it stronger."

He pledged to ring-fence front-line services in key areas such as defence, international development and the NHS and to protect funding for schools, SureStart and 16 to 19-year-olds' education.

But he warned "tougher decisions" were to come in next month's emergency Budget and the autumn comprehensive spending review.

Cutbacks in the budgets of advertising, IT projects, consultancy and furniture are also on the target list.

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By London Reporter Sunita Patel

Where the axe will fall

  • £1.15 billion in discretionary areas such as consultancy and travel costs.
  • £1.16 billion by reducing grants to local authorities.
  • £95 million through savings in IT spending.
  • £1.7 billion from renegotiating, delaying and stopping contracts and projects.
  • £170 million from reductions in property costs.
  • At least £120 million from a civil service recruitment freeze.
  • £600 million from cutting the cost of quangos
  • Child Trust Funds axed to save £320 million.
  • Scaling back new housing budgets by £150 million.
  • £270 million funding cuts for regional development agencies spared the axe.
  • £320 million from ending ineffective elements of employment programmes.
  • £80 million from closing education quangos like BECTA.

DEPARTMENTAL CUTS:

Department for Education - £670 million.

Department for Transport - £683 million.

Communities and Local Government - £780 million.

CLG Local Government - £405 million.

Business Innovation and Skills - £836 million

Home Office - £367 million.

Ministry of Justice - £325 million.

Law Officers' Departments - £18 million.

Foreign and Commonwealth Office - £55 million.

Department for Energy and Climate Change - £85 million.

Department for Environment Food and Rural Affairs - £162 million.

Department for Culture Media and Sport - £88 million.

Department for Work and Pensions - £535 million.

Chancellor's Departments - £451 million.

Cabinet Office - £79 million.

Devolved Administrations - £704 million.

TOTAL = £6.243 billion.

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