We have today seen the Chancellor announce cuts in Public Spending of a little over £6bn to take effect almost immediately.
However, the Government really needs to cut expenditure by at least ten times that figure. £6bn only just covers the interest charge on the deficit.
There will undoubtedly be a knock on effect:
Increase in unemployment
Reduction in Public Services
Potential delay in economic growth
The benefits are:
Increase in International Confidence that UK is dealing with debt problem
Fends off an attack by the Ratings Agencies of the UK debt - thereby reducing interest rates payable
However, when the next tranche of cuts arrive we shall be able to judge the relationship of the cuts in the Public Sector vs any growth in the Private Sector.
For us, the important cut is the reduction in Ministerial Cars, meaning most Ministers will have to rely on public transport. We look forward to them joining the real world as human beings, outside their rarified bubble of privilege and unreality.