BBC News - Business

Tuesday, 22 December 2015

Osborne scraps plan to cut police budget, tax credits

A still image from video shows Britain's Chancellor of the Exchequer George Osborne as he delivers the Autumn Statement to Parliament in London, Britain November 25, 2015. REUTERS/UK Parliament via REUTERS TV

Britain's conservative government surprised voters Wednesday by scrapping cuts to police numbers and tax credits, even as it stuck to a pledge to return the national budget to surplus.

The backflips were revaled by Chancellor George Osborne as he outlined the government's spending plans for the next five years, and come after recent terror attacks in Paris and Mali put national security back at the top of the political agenda.

"Now is the time to back our police and give them the tools to do the job," Osborne told the British parliament, while also unveiling an increaese in the national defence budget to £40 billion from £34 billion.

"I am today announcing there will be no cuts in the police budget at all."

Sluggish economic growth had prompted government politicians earlier this year to warn that billions of dollars could be slashed from police forces--part of an aggressive austerity drive designed to get the national budget back in the black.

But opposition to the cuts began hardening after Islamic extremists killed 130 people in Paris on Nov.13 . Police chiefs this week warned that major budget cuts could hinder their ability to prevent similar attacks from occuring in the UK. 

On Wednesdasy, Mr. Osborne also dropped a controversial proposal to cut tax credits for low-paid workers. The government, however, would press on with proposed reductions in welfare spending of around £12 billion. Those cuts, combined with improvements in government finances, would allow it to return the budget to surplus by the 2019/20 financial year, Osborne said.

Money would also be saved by selling or closing under-used courts and old prisions, including the Holloway women's prison in London.

As was widely expected, Osborne announced a doubling in the nation's housing budget to £2 bilion over the next five years. The move, targeted at younger voters, will facilitate the construction of 400,000 new homes, addressing "a growing crisis of home ownership in our country", Osborne said.

Among other key plans, Osborne said the basic state pension will rise by £3.35 in April to £119.30 a week.

Source: https://uk.finance.yahoo.com/news/osborne-scraps-plan-to-cut-police-budget--tax-credits-151834979.html