The Straits Times
Published on Nov 26, 2012

UK may face deeper government spending cuts: IFS


LONDON (REUTERS) - Britain's finance minister George Osborne may have to announce more spending cuts and tear up one of his key austerity goals next month, the Institute for Fiscal Studies (IFS) said on Monday, warning government borrowing was likely to rise this year.

Mr Osborne, who updates parliament with the latest official borrowing and growth forecasts on Dec 5, has struggled to keep his austerity targets on track because of the economic malaise.

The Conservative has already extended the planned period of spending cuts by two years, well beyond the next election in 2015, and warned of further cuts to welfare spending.

Poor economic performance since the March budget means more bad news could be on the way next month, including the embarrassment of higher borrowing this year compared to last.