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Budget changes will cost public sector jobs, warns Tim Farron

Published 18/03/2016

Tim Farron said changes to the funding of public sector pensions set out in the Budget were a 'vicious attack' on already-stretched services
Tim Farron said changes to the funding of public sector pensions set out in the Budget were a 'vicious attack' on already-stretched services

A "back door" raid by George Osborne will directly result in reduced numbers of doctors, nurses, police, teachers and armed forces personnel, Tim Farron has said.

The Liberal Democrat leader said changes to the funding of public sector pensions set out in the Chancellor's Budget were a "vicious attack" on already-stretched services.

Departments face contributing more to the overall cost from 2019 - effectively saving the Treasury around £2 billion a year - because of a reduction in the "discount rate".

It affects "unfunded" schemes in the public sector, including those for the NHS, the Army, police, teachers and civil servants.

The Lib Dems said that meant a £649 million bill for the health service, £426 million for schools, £314 for the armed forces, £101 million for the police and £10 million for fire services.

"Even by George Osborne's standards, this is a vicious attack on our health service, schools and public services," Mr Farron said.

"He made grand promises about funding the NHS and is now making secret cuts by the back door.

"The Conservatives simply cannot be trusted to protect the services communities rely on up and down the country."

Mr Farron dismissed as a "mirage" Mr Osborne's insistence that lower-then-expected inflation meant the gap could be closed without affecting front-line spending.

"It may well be true that, for the time being at least, those people working in the NHS will not have their personal pensions affected," he told BBC Radio 4's Today.

"What will be affected is whether or not we can afford to have those jobs in the first place.

"The only consequence for this can be fewer doctors, fewer nurses, a worse deal for junior doctors, fewer teachers, less money for schools, fewer police, and people who have served their country in the armed forces being given their P45."

According to the Red Book, the discount rate is being reduced from 3% above CPI inflation to 2.8% from 2019.

The figure is reviewed every five years, and reflects the Government's estimate for the rate of economic growth over the medium term.

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