Tories may cut defence spending, says Osborne

Major defence projects may not be safe from public spending cuts if the Tories win the next general election, shadow chancellor George Osborne hinted today.

He suggested "break clauses" in contracts for two new aircraft carriers, Eurofighter aircraft and the A400M transporter were among things a new administration would like to examine.

Mr Osborne spoke out as he accused Gordon Brown of preparing to "hoist the white flag" ahead of a speech to the TUC later in which the Prime Minister is expected to explicitly admit the need for spending "cuts".

The Conservatives had been right to warn of the need to restrain spending, he said, with Labour engaged in a "dangerous fantasy" that the UK could spend its way out of trouble.

Asked whether his party would be able to identify specific savings quickly enough for a snap post-poll budget, Mr Osborne conceded that the Opposition faced some hurdles.

"The resources of an opposition are limited. I have probably 10 people working for me; there are about 1,000 people working for the Chancellor and the Treasury.

"And there are some things we do not know: I do not know the details of some of the major defence projects which have been the subject of speculation in the newspapers.

"I simply do not know what the break clauses are in the Eurofighter programme or the A400M or the aircraft carriers. We do have those limitations."

Only health and international aid have been spared the prospect of Tory cuts, with defence proving one of the most contentious areas.

Both Labour and the Conservatives are committed to a defence review after the election.

Mr Osborne told a conference organised by The Spectator magazine that the Government's public acceptance of the need for spending cuts was a vindication of Tory policy.

"Gordon Brown is on the eve of a complete capitulation. Whether he hoists the white flag today at the TUC or later at his conference or when Parliament returns, we will see," he said.

"But hoist that white flag he will. For he and his style of politics have been comprehensively defeated. And it is the Conservatives who have made the right judgment about the biggest economic question that faces this country."

He went on: "For months we endured the onslaught of Gordon Brown and Labour Cabinet ministers as they spoke in apocalyptic terms about what would happen if you cut spending.

"Time and again this summer in the House of Commons, David Cameron fought back across the despatch box and challenged the Prime Minister to tell the truth.

"When people ask 'are the Conservatives up to it?', I say look how David Cameron and our party told the truth about the national debt, told the truth about public spending and won the biggest economic argument of the day.

"We have shown in the way we have conducted ourselves that we now command the centre of British politics, and we have the character, the judgment and the courage to take this country through the difficult times ahead."

He questioned ministers' claims to have "seen Britain through" the downturn, pointing to faster recovery in other countries and faster-rising unemployment, but said he did expect the UK to come out of recession this year.

"It is increasingly clear that the Labour Party is either unable or unwilling to learn the lessons of the last decade," he said.

"Their strategy for the recovery is to try and pump the bubble back up with more Government spending and debt-fuelled consumption.

"As with our failed system of financial regulation, or our broken politics, they seem to think we can carry on much as before, with a few tweaks here and there.

"That is not just the wrong conclusion, it is a dangerous fantasy."

Mr Osborne also criticised a return to large bank bonuses.

"We are underwriting these profits for a purpose - to help recapitalise the banks and support the broader economy, not so that they can be paid out as huge bonuses or distributed as excess returns to shareholders," he said.

"Indeed, if banks pay out huge bonuses on the back of taxpayer support instead of using profits to rebuild their balance sheets, that is not only bad for the broader economy, it is bad for the City itself.

"It is not in the interests of the financial services sector as a whole to have a small number of Government-subsidised players distorting competition by using taxpayer support to bid up remuneration levels."



Mr Osborne said a new Tory administration would present a Budget within weeks of taking office.

"I would anticipate a Budget fairly shortly after the General Election. Whether it would be in June or July would be to be decided," he said.

The poll is expected to be called for May next year.

"But absolutely we would have an early Budget and we need to make early and big decisions about dealing with the deficit."

But he denied it would amount to an "emergency" Budget - insisting it was normal practice after a change of government in the spring.

"Labour did it in 1997 and I think Margaret Thatcher did in 1979," he said.

"It is perfectly reasonable at a time of economic distress that we get on with announcing economic policies."

PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
Britons buy more than 30 million handsets each year, keeping them for an average of 18 months
tech
Arts and Entertainment
Alloysious Massaquoi, 'G' Hastings and Kayus Bankole of Young Fathers are the surprise winners of this year's Mercury Music Prize
musicThe surprise winners of the Mercury Prize – and a very brief acceptance speech
Arts and Entertainment
TV Presenters Ant McPartlin and Dec Donnelly. Winners of the 'Entertainment Programme' award for 'Ant and Dec's Saturday Night Takeaway'
musicAnt and Dec confirmed as hosts of next year's Brit Awards
Arts and Entertainment
Orson Welles made Citizen Kane at 25, and battled with Hollywood film studios thereafter
film
News
video
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Teaching Assistant to work with Autistic students

£60 - £65 per day: Randstad Education Leicester: Randstad Education Leicester ...

KS2 Teacher

Negotiable: Randstad Education Cambridge: KS2 Teacher needed in Peterborough a...

SEN Learning Support Assistant

£70 - £75 per day: Randstad Education Group: SEN Learning Support Assistants n...

Teachers required for Cambridge Primary positions Jan 2015

Negotiable: Randstad Education Cambridge: Primary Teachers needed in Cambridge...

Day In a Page

Isis in Syria: A general reveals the lack of communication with the US - and his country's awkward relationship with their allies-by-default

A Syrian general speaks

A senior officer of Bashar al-Assad’s regime talks to Robert Fisk about his army’s brutal struggle with Isis, in a dirty war whose challenges include widespread atrocities
‘A bit of a shock...’ Cambridge economist with Glasgow roots becomes Zambia’s acting President

‘A bit of a shock...’ Economist with Glasgow roots becomes Zambia’s acting President

Guy Scott's predecessor, Michael Sata, died in a London hospital this week after a lengthy illness
Fall of the Berlin Wall: History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War

Fall of the Berlin Wall

History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War
How to turn your mobile phone into easy money

Turn your mobile phone into easy money

There are 90 million unused mobiles in the UK, which would be worth £7bn if we cashed them in, says David Crookes
Independent writers remember their Saturday jobs:

Independent writers remember their Saturday jobs

"I have never regarded anything I have done in "the media" as a proper job"
Lyricist Richard Thomas shares his 11-step recipe for creating a hit West End musical

11-step recipe for creating a West End hit

Richard Thomas, the lyricist behind the Jerry Springer and Anna Nicole Smith operas, explains how Bob Dylan, 'Breaking Bad' and even Noam Chomsky inspired his songbook for the new musical 'Made in Dagenham'
Tonke Dragt's The Letter for the King has finally been translated into English ... 50 years on

Buried treasure: The Letter for the King

The coming-of-age tale about a boy and his mission to save a mythical kingdom has sold a million copies since it was written by an eccentric Dutchwoman in 1962. Yet until last year, no one had read it in English
Can instilling a sense of entrepreneurship in pupils have a positive effect on their learning?

The school that means business

Richard Garner heads to Lancashire, where developing the 'dragons' of the future is also helping one community academy to achieve its educational goals
10 best tablets

The world in your pocket: 10 best tablets

They’re thin, they’re light, you can use them for work on the move or keeping entertained
Lutz Pfannenstiel: The goalkeeper who gave up Bayern Munich for the Crazy Gang, Bradford and a whirlwind trawl across continents

Lutz Pfannenstiel interview

The goalkeeper who gave up Bayern Munich for the Crazy Gang, Bradford and a whirlwind trawl across continents
Pete Jenson: Popular Jürgen Klopp can reignite Borussia Dortmund’s season with visit to Bayern Munich

Pete Jenson's a Different League

Popular Klopp can reignite Dortmund’s season with visit to Bayern
John Cantlie video proves that Isis expects victory in Kobani

Cantlie video proves that Isis expects victory in Kobani

The use of the British hostage demonstrates once again the militants' skill and originality in conducting a propaganda war, says Patrick Cockburn
The killer instinct: The man who helps students spot potential murderers

The killer instinct

Phil Chalmers travels the US warning students how to spot possible future murderers, but can his contentious methods really stop the bloodshed?
Clothing the gap: A new exhibition celebrates women who stood apart from the fashion herd

Clothing the gap

A new exhibition celebrates women who stood apart from the fashion herd
Fall of the Berlin Wall: Goodbye to all that - the lost world beyond the Iron Curtain

The Fall of the Berlin Wall

Goodbye to all that - the lost world beyond the Iron Curtain