Osborne urged to be 'more radical' with cuts

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Bosses have called on Chancellor George Osborne to take a "more radical" approach to next week's comprehensive spending review, in which he aims to slice £83 billion from public spending.


The Institute of Directors urged the Chancellor to ditch the protection which the Government has promised to the NHS and overseas aid budgets, in order to preserve investment in transport, energy and IT infrastructure.


The IoD voiced "concern" that ministers are not using the spending review to carry out root-and-branch reform of public spending and direct the limited cash available towards measures which would boost long-term growth.


Shadow chancellor Alan Johnson warned earlier this week that Mr Osborne's review will lead to cuts deeper than those imposed by Margaret Thatcher in the early 1980s.


But the IoD said even if Mr Osborne's planned reductions - amounting to an average 25 per cent of Whitehall departments' budgets over the next four years - are implemented in full, the state will still be spending 40 per cent of national income in 2015/16, about the same as in 2008.


In cash terms, total public spending will be £90 billion higher at the end of the process than it is now, said the organisation, which represents business leaders.