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Deep public spending reductions after the next election looked inevitable today as the Government was forced to borrow frantically to make ends meet and a new poll showed strong public support for cuts.
A growing appetite among voters for tough action to rein in state spending was shown by an opinion survey that found four in five believe significant spending cuts will happen whoever wins the election.
A third believed cuts were the right policy to rebalance the public finances, while two-fifths said there should be a combination of cuts and tax increases. Only one in five believed that taxes should be increased to curb the need to borrow.
More evidence of the dangerous state of the public finances was revealed last night with figures showing that the Government's tax take plummeted by £32 billion last year. Revenue from income tax, national insurance, VAT, stamp duty, corporation tax and other levies plunged by £21.7 billion as the recession hit. Another £10 billion was wiped out by dubious debts and legal disputes over tax.
It was the most sudden drop in Exchequer revenues since 1923 and forced the Treasury to increase the record amounts it is having to borrow.
Official figures show Britain is selling £220 billion of gilts this year, four times the typical amount of the past four years.
Today's Populus poll in the Times delivered a major blow to Gordon Brown's election strategy of offering a choice between higher spending under Labour, with public service cuts under David Cameron.
Not only do voters think cuts are inevitable under both parties, but they have more trust in Mr Cameron to carry them out without harming key public services. Some 38 per cent trusted the Tory scalpel, compared with 28 per cent preferring Labour. Optimism about the economy has also fallen sharply over the past month. The proportion thinking the economy will do well rather than badly has dropped from 32 to 25 per cent, while the pessimists have grown from 63 to 73 per cent.
Adding to Mr Brown's woes, the poll confirmed that Labour is heading for a massive defeat in Thursday's crucial by-election in Norwich North. Nationally, the Conservatives were backed by 38 per cent while just 26 per cent backed Labour and 20 per cent backed the Liberal Democrats.
The Prime Minister has been warned by several Cabinet colleagues that voters are not convinced he can avoid cuts. Chancellor Alistair Darling argues that the election battle must be about competing priorities and values instead.
Last weekend, former Cabinet minister John Hutton warned that Mr Brown was “heading for trouble” unless he changed his message.
Reader views (14)
Spot on malcolm unless the deluded R Race(Is he real of borrowing the name from the old comic book character) and Autumn are mandys subs for the shy Unison, Keith and Brown's apologist Val. Isn't it strange that the brown apologists like the two deluded critics criticise what "might" happen yet are obviously content with the massive holes in the UK economy. Isn't it immoral to overlook this and revel in the debts being left to future generations? well, they seem to be using Brown's shatterd moral compass.
- Ican Seeclearly, baldock, 21/07/2009 17:17
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The problem with socialism is that eventually you run out of other people's money. (Margaret Thatcher, 1976)
- George, London, 21/07/2009 13:59
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Notice how the fact that Government revenues have fallen by £32billion was released on the day that parliament went into the longest ever summer recess!!! This together with the information that:
1) A further £2bn has been lost to fraud/error in Gordon Brown's flagship Tax Credit scheme - that makes a total of over £10billion lost since they were introduced
2) The Financial Accounts of 4 government departments have failed t5o meet the standards required by the National Audit office andso have NOT been signed off - including The Treasury!!!
Yet another example of this disgraceful Governments policy of " burying bad news". So much for Gordon Brown's new "open government". Says everything you need to know about New Labour & spin.
No doubt Keith from Luton and Val from Mijas will have some excuse to offer
- Malcolm, London, 21/07/2009 13:27
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I'm with Gordon - we don't need any spending cuts, the earth isn't round, the moon's made of cheese, Elvis is alive and well.
Keep it up Gordo - you'll be proved right on all of them in the end I'm sure!!
- David B, Manchester, 21/07/2009 12:48
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Gaswork, please could you rephrase into English so we can follow your 'thinking'?
- David Chiene, London, 21/07/2009 12:28
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Cuts are unavoidable. So, how about cutting MPs salaries or expense claims?
- Marianne, SW France/London, 21/07/2009 12:21
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I think that being caught out lying isn't that bad, when compared to Cameron who has never been caught out telling the truth?
Whichever way it goes, the country will be put to right by undermining the county’s health and education, the victims (unemployed and poor) will be demonised and crime will rise.
A proven policy that got the country back on its feet in weeks after Thatcher sold off the countries assets in an economical model that even she now admits was wrong.
- Autumn, Wirral, 21/07/2009 12:04
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That's the best thing about Cameron, he can make people believe anything. It will be interesting to see if being in power affects his persuasive powers. I think his strategy is, if anything goes wrong the Minister gets the bullet so don't blame the Ringmaster. It couldn't happen to a nicer bloke than Osborne.
- R Race, Ealing England, 21/07/2009 11:55
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I don't know why they even bother printing anything the libour party say anymorre.
We don't believe them, and they are not getting in next year anyway, so can we have a sort of semi labour announcements black out till the end of the year please.
Now that would really piss them all off.
- P Staker, London, 21/07/2009 11:45
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It's not just Brown it's the whole system and its been, Margaret Thatcher john major Blair then brown and now it looks like the conservatives again so what's the game being played, Remember when the UK had Nationalised coal mines, it's own Gas, ran its own water and power plants trains buses industry so on this was allowed to be run down with no investment other that the parties creaming it for all they could get out which fell into disrepair before being sold off cheaply, We are looking at parties that only Know of reduction of destruction, when are they going to learn when to bring this country up to speed we must invest into our infostructure with new technology, this way we wont keep having to fool the public that every thing is OK, under Margaret Thatcher when she Broke the miners and then sold off all that was making money for this country and that she Broke the back of the uk I find this deliberate? Then this so called labour party did the same and look at the state of the UK now! Please people consider the UKip I don't think the UK could stand another ConLabLib party if not vote for our children and get out of Europe which has smashed this country from all them that love it's gravy train for political gain.
- Gaswork, Dormanstown, 21/07/2009 11:36
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Gordon Brown could not tell the truth standing on a stack of bibles , he is in total denial and this is obvious to all but him.
He´s as dumb as a duck on a dung heap when it comes to telling the truth.
John
- John Nicholson, Girona, Spain, 21/07/2009 11:20
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During 12 years of inherited boom, Brown mouthed prudence, but both stealth-taxed and grossly overspent, in particular adding to inefficient public sector. While economic downturn is global, that Britain is among the worst affected and least prepared is entirely due to Brown's mismanagement. Now he wants to get re-elected by simply wanting to continue to overspend, much like a gambler who having lost believes betting even more money is the only way out. The tragedy is he is going to leave behind such huge debt that we will be bearing the consequences fo decades. In the meantime, hopefully the one thing he can not do is to attempt to continue to fool the public.
- Nat, New Malden, 21/07/2009 11:14
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There isn't going to be any cuts, gormless has said so. Instead expect massive tax increases. What is the lastest labour plan ? to charge everybody who retires 20K upon retirement to cover their old age. Of course there is the council tax revaluation for England (laws are already in place). If labour win the next election expect any army of council busy bodies to enter your house and photograph everything.
- Chris, Rochester, 21/07/2009 10:44
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Quoted in previous press releases, the PM telling untruths because one cannot honourably call them lies or liars.
Put simply, who gives a hoot. BROWN is a UTTER and TOTAL
LIAR. Put even more simply, how often has he told the truth ?
No doubt, Val from Spain will be commenting shortly.
- Asw, HK, 21/07/2009 09:59
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