Cabinet ministers were ordered today to prepare a new round of spending cuts that will bite during the general election.
The new squeeze came as a rise in borrowing put Britain’s AAA credit rating under new pressure.
Chancellor George Osborne told ministers at a Cabinet meeting to start work immediately on efficiency savings in most departments for the 2015/16 year. Experts believe that some departments will face cuts of 40 per cent so that spending on schools, the NHS and foreign aid can be protected from the axe.
“There was agreement around the table that although the decisions that we are going to have to take are difficult, they will have to be made,” said a Downing Street official.
Mr Osborne and chief secretary Danny Alexander said ministers should find imaginative ways to do “more with less” rather than simply axe services.
The country’s prized AAA credit rating came under threat after it was revealed the UK borrowed £15.4 billion last month — £600 million higher than a year earlier. Borrowing could burst the £108 billion target this year.
