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Commenting on George Osborne’s speech on the UK economy, Professor Philip Booth, Editorial Director at the Institute of Economic Affairs, said:

“George Osborne is right to focus on the need to reduce the level of government spending further. At the end of this parliament, government spending will still be much higher, as a proportion of national income, than the levels we saw at the beginning of the twenty-first century.

“However, it will prove impossible for the government to deliver the necessary spending cuts whilst maintaining its commitment to ring-fencing. David Cameron's promise to increase pensions in real terms, more or less no matter what economic conditions prevail, is irresponsible and completely at odds with the Chancellor’s rhetoric. Areas such as health, schools, foreign aid, HS2, pensions and other benefits for older people should all be considered as areas in which savings can be made.”

“In the context of the long-term fiscal position, the government’s promises are both reckless and inconsistent even with George Osborne's limited ambitions to cut spending.”

Notes to editors:

To arrange an interview with an IEA spokesperson please contact Stephanie Lis, Head of Communications: 0207 799 8909 or 07766 221 268.

In July 2011, the IEA published Sharper Axes, Lower Taxes: Big Steps to a Smaller State. The research laid out plans to get government spending to below 30% of GDP.

The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.

The IEA is a registered educational charity and independent of all political parties.