Unions and business offer polar review reactions

Business leaders said they understood the need to make drastic savings to tackle the UK's huge deficit, but unions described the cuts in the Comprehensive Spending Review as a "brutal assault" on public services.

John Walker, chairman of the Federation of Small Businesses, said: "We all know we are living in an age of austerity and that these cuts will affect us all, but our members understand that to reduce the public sector deficit, these cuts had to be made.

"The small business community continues to have a vital part to play in driving a credible recovery and taking on new members of staff to help tackle unemployment, so it is now vital the Government puts a small business programme for growth into action immediately.

"As our research shows, small firms are at tipping point and lack the confidence to take on the 500,000 people that will be made redundant as a result of these cuts. So it is up to the Government to incentivise the small business community - through extending the National Insurance contribution holiday to existing firms and cutting VAT to 5% in the construction sector - to promote growth and help small firms take on new staff."

Paul Kenny, general secretary of the GMB, said: "After this review, the broadest shoulders will still have the fattest wallets.

"The price for George Osborne's day of reckoning will be paid by the economy, in the public and private sectors, and those unemployed, for a decade to come.

"In a well leaked, well crafted ideological speech, arrogantly delivered, the demise of public services and the welfare state was laid out in front of us.

"As this plan unfolds and its impact is felt in homes and communities up and down the country, the Tory/Liberal authors will find life increasingly difficult at the ballot box."

Bob Crow, general secretary of the Rail Maritime and Transport union, said: "These cuts represent the most brutal assault on public services, jobs and living standards since the 1930's and show that the ConDem government are prepared to force working people to carry the can for an economic crisis cooked up in the boardrooms and on the trading floors. This is all-out class war with its roots firmly planted in the playing fields of Eton."

TUC general secretary Brendan Barber said: "Right across Government the Chancellor has announced eye-watering cuts that will have a desperate impact on communities, business and hard-pressed families, but he has not had the guts to spell out the detail, and instead tried to talk up a few crumbs of good news.

"Worst of all, to score a cheap party political point about Labour spending plans, he has loaded cuts on to benefits and welfare payments. Those who have not had a minister fighting their corner but who are most vulnerable to cuts have lost the most today. The poorest have become the victims of a political jape."

Unite's joint leader Derek Simpson said: "This is not a spending review - it's a massacre. It's totally perverse to claim that cutting half a million jobs and razing our public services to the ground is good for this country.

"No matter how often they repeat that their actions are fair, this Government is making a political choice to attack the public sector and, by doing this now, damaging the whole of the economy long into the future.

"There is no evidence that public sector workers who lose their jobs will find alternative work in the private sector. In fact these cuts will destroy nearly as many private sector jobs as public sector ones."

Richard Hawkes, chief executive of disability charity Scope, said: "Despite the continuing rhetoric that spending cuts will be fair the Chancellor's announcements today are anything but.

"Local government will lose 28% of its funding over the next four years, compared to just 14% reductions to the royal household, and this will hit disabled people and their families particularly hard."

David Hillman, spokesman for the Robin Hood Tax campaign said: "These cuts are not inevitable, they are a political choice. A fair Robin Hood Tax on the financial sector would allow George Osborne to avoid the worst of his cuts.

"The Chancellor said today he will impose the maximum possible tax on banks, but words are not enough. As ordinary workers and families feel the pain of the cuts, he must go further than the dismal £2.5 billion bank levy. Banks can afford to pay £20 billion more a year."

Matthew Sinclair, director of the TaxPayers' Alliance, said: "It's great news that the Government is going ahead with necessary spending cuts to get the deficit under control and that politicians are finally setting out clear plans to deal with the fiscal crisis.

"Many wasteful programmes are being cut and that will mean savings for taxpayers now and in the future. Unfortunately a number of measures that would save significant amounts of money while minimising the impact on services haven't been taken, like a freeze in the International Development budget or pay cuts for the best paid public sector staff. Sensible and necessary cuts have been announced today but more can be done to deliver good value for hard-pressed taxpayers."

Richard Lambert, the CBI's director general, said: "The Chancellor has got the strategic direction of this spending review right. He has stayed the course outlined in the June Budget, with economic growth a top priority.

"We particularly welcome the extra £2 billion a year on capital spending, and the focus on areas that support growth. These include transport and other infrastructure, education and science, and the low-carbon economy.

"The spending cuts, though painful, are essential to balance the UK's books and build its future prosperity. Now the Government must deliver its promised savings by re-engineering public services."

Phil Bloomer, Oxfam's campaigns and policy director, said: "David Cameron and George Osborne deserve real credit for their promise to stick to Britain's aid promises during these difficult economic times. The coalition has taken the tough choice to prioritise the poorest people on the planet during the bad times as well as good."

Mark Serwotka, general secretary of the Public and Commercial Services union said: "This spending review will throw a generation of people on the scrapheap. These cuts are a political choice, there is an alternative, not a penny needs to be cut, nor a single job lost.

"Rather than attacking the vital services offered by our members and removing jobs from some of the most vulnerable communities across the UK, the coalition should be creating jobs in both the public and private sectors, closing the £120 billion tax gap, introducing a Robin Hood Tax on banking speculation and investing in our future.

"This announcement shows we are not all in this together but illustrates that it is the poorest in society who will have to bear the brunt of a crisis that was not of their making, while the millionaires in the Cabinet massively increase the gap between the haves and have nots."

Ian Brinkley, associate director of The Work Foundation said: "The coalition should be commended for protecting the science budget, supporting the low carbon economy and restoring some of the cut-backs in infrastructure investment. The commitment to support advanced manufacturing, high growth small firms, and the funding of an elite network of R&D technology and innovation centres are exactly the right priorities to support Britain's long term growth.

"The cuts in public sector jobs can be absorbed by growth in the private sector - but only if job creation in the private sector is sufficiently strong."

David Frost, director general of the British Chambers of Commerce, said: "Business has been clear, the deficit must be tackled, no matter what. The spending review does the job of setting out how this will be done.

"Overall, the spending review could have been worse for business. While we were disappointed that the Government succumbed to political ring-fencing of some spending areas, cuts to productive infrastructure investment were not as bad as many had feared."

Miles Templeman, director general of the Institute of Directors, said: "We strongly support the Government's determination to stick to its overall plan of reducing public spending quickly. The only way we get a private sector recovery under way is through macro-economic stability, and this will only be achieved with sustainable public finances.

"Opponents of today's spending reductions need to wake up to that fact. The alternative is a tax hike which would damage the economy in both the short and long term."