Labour's alternative

Labour believes we need to reduce the deficit.  But this must be done in a way which does not endanger the recovery. We would prioritise growth and jobs, in recognition that they must be central to any economic strategy. Under our plans, additional money from the banks would contribute to £7.5 billion of capital spending – supporting jobs now and creating the infrastructure for future growth.

Alan Johnson MP, Labour's Shadow Chancellor, today said George Osborne’s job cut plans could cost the taxpayer £8bn.

Mr Johnson has based his figures on the redundancy bill for the Ministry of Justice, where 14,000 staff are set to lose their jobs at a cost of £230m.

Alan Johnson said:

“If the taxpayer has to foot a comparable redundancy bill for the 490,000 jobs that are to go across the public sector, George Osborne has lined them up for an £8bn hit.

That is the price of going too far and too fast. On a timetable determined by the date of next election, not the economic cycle.”