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LONDON, Oct 29: British finance minister John Healey said the government would reduce \u200cspending on welfare benefits as he sought to address one of the big public spending challenges that remain after his first budget announcement.<\/strong><\/p>\n \u201cWe have to bring the benefits bill down. You don\u2019t do that by crude cuts,\u201d he said in an interview with the BBC.<\/p>\n<\/blockquote>\n Speaking later to reporters, Prime Minister Andy Burnham said the government was \u201cworking flat out\u201d \u2060to get the welfare bill down as quickly as possible.<\/p>\n Healey\u2019s tax and spending plans offered some short-term support for households hit \u200bby the surge in energy prices caused by the US-Iran war, financed partly by higher taxes on banks, savers and landlords.<\/p>\n But the \u200bbudget did not address long-term questions such as how to raise defence spending to 3% of economic output, offset inflation\u2019s impact on public spending and tackle the growing welfare bill, which includes pensions as well as support for people deemed too ill to work.<\/p>\n Spending on welfare is set \u200bto cost more than 11% of economic output this year. However, markets reacted broadly favourably to Healey\u2019s budget and 10-year government borrowing costs touched \u200ca one-month \u2060low on Thursday.<\/p>\n Healey focused on the problem of unemployment among young people.<\/p>\n \u201cThis system is unsustainable,\u201d he said. \u201cI feel a moral duty to deal with these youngsters (who) have been written off.\u201d<\/p>\n Healey said the government would help young people out of work who would be required to take opportunities on offer.<\/p>\n Eduin Latimer, senior research economist at the Institute for Fiscal Studies think tank, said \u200bthat approach might save money \u201cbut it\u2019s \u200bmuch more uncertain than \u2060just directly cutting entitlements or eligibility and it\u2019s likely to give you savings over a longer timeframe, if you do deliver savings.\u201d<\/p>\n A government review into young people out of employment, education or vocational \u200btraining and another into the disability benefits system are due to be published next month.<\/p>\n Healey \u200bdrew criticism from \u2060the left-leaning Resolution Foundation think tank for spreading too thinly his flagship spending measure \u2013 a \u00a3100 ($133) reduction in energy bills for 20 million households to offset some of the sharp increase in bills caused by the US-Iran conflict.<\/p>\n \u201cEven those families receiving help (will be) facing higher \u2060energy bills \u200bthan they did during the last energy price shock,\u201d its chief executive \u200bRuth Curtice said.<\/p>\n Typical energy bills this financial year are set to rise to \u00a31,750 a year after government support, 4% higher than after Russia\u2019s 2022 invasion of Ukraine, \u200bthe think tank said.<\/p>\n<\/div>\n\n
The opposition Conservative Party and some bond investors say that reveals a \u200black of will in Burnham\u2019s Labour Party to lower borrowing.<\/p>\nTACKLING YOUTH JOBLESSNESS<\/strong><\/h3>\n