Great Britain introduces the tighest budget in 25 years. by Milota Sidorova

That moment British voters favorized Conservatives it was perfectly clear there would be major cuts in national budget. Now, after just few weeks George Osborne presents the tighest budget in past 25 years. Although it was expectable, the cuts would be deep. It will hit public and financial sector, by reducing and freezing benefits and payments and imposing new taxes, including bank taxes. Germany, France and Great Britain backed proposed banking tax last week during Brussel's meeting. Osborne want the new levy to come into force in 2011. Banks should derive 2 billion pounds per year. Cuts in government organizations will increase up to 25 percent. Public sector workers sho! uld have their payments frozen for next two years. Cuts will even hit Queen Elisabeth who has already accepted frozen payments during next period. What seems to be quite interesting is no tax increase on alcohol, fuel and tobacco. The budget will stop children benefits for three years and total welfare cut will assume 11 billion pounds. Housing benefits will be limited such as conditions for work disability.Government wants to push hard for increasing retire age up to 66 years and working people would have to tax 20 percent of their salary by January 2011. Politicians however, want to solve unemployment that should reach its maximum 8.1 percent this year. The long-term projection suggests it should fail down to 6.1 percent in 2015. The whole GDP is expected to slow down from 2.6 percent to 2.3 percent next year, but is should gradually rise back to 2.7 percent between 2014 and 2015.

related story (sgx17667): http://www.france24.com/en/20100622-uk-finance-minister-deli...

by Milota Sidorova for Cantell TV (http://cantell.tv)

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