Possible cuts to fix UK finances

UK finance minister Jeremy Hunt (left) has reversed most of former Prime Minister Liz Truss’s (right) £45 billion (€52bn) of unfunded tax cuts. He needs to raise as much as £40bn (€46bn) to plug a hole in public finances


Government savings: Hunt has called on all departments to cut budgets by up to 15%

Pensions: Under “triple lock,” state pensions increase by highest of earnings, inflation or 2.5%

Inflation: At 10.1%, pension bill will increase by some £25bn (€29bn) – Office for Budget Responsibility

Pension cuts: Pension and welfare payments could be linked to average earnings rather than inflation, saving £6bn (€7bn) a year

Banks: Hunt could reverse plan to cut surcharge on bank profits from 8% to 3%

Bank reserves: British banks hold around £947bn (€1,086bn) of reserves at Bank of England and receive interest at 2.25%. Paying interest on only £100bn (€115bn) of reserves could save up to £45bn (€52bn) a year

Infrastructure: Chancellor could cut back £11bn (€12.6bn) project to build affordable new homes, and parts of HS2 high-speed railway

Foreign aid: Britain – among leading donors to poor nations – could freeze aid at 0.5% of
GDP instead of rising to planned 0.7%, saving £3.5bn (€4bn)


Sources: Bloomberg, Reuters, UK Government
Pictures: Getty Images 
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