The phony war is over. George Osborne's Comprehensive Spending Review statement is the artillery barrage signalling the start of the shooting war. Far from striking a sombre note appropriate to the circumstances and despite Dave's handwringing, the Tory benches were in a chipper mood as the chancellor announced assault after assault on the social wage and the public sector.
Osborne prefaced his avalanche of cuts with the usual deficit deceptions. The Coalition's actions in the summer saw Britain "step from the brink". The cuts are designed to reduce the "waste and welfare we can no longer afford" and that we are stuck paying billions upon billions out to foreign creditors - even though the bulk of debt is domestically owned!
Measures introduced were
* Capital spending at £51bn, £49bn, £46bn and £47bn until 2014-15.
* Total public spend of £702bn, £712bn, £724bn, £740bn until 2014-15. In real term this is the same as at 2008.
* 3 principles - reform - fairness 'all in it together' 'broadest shoulders' - growth (prioritise those promoting growth)
* £6bn Whitehall savings with an estimated 490,000 job losses over four years (claims much will come from natural turnover). Believes private sector will take up the slack and cited 178,000 new jobs created over the last three months as an example of the economy's capacity to absorb the shock. Money to be provided for BigSoc projects.
* Treasury dept. budget to be reduced by a third. Cabinet office to find £55m savings.
* Civil List: a new settlement with one year cash freeze, 14% fall in 2012-13 royal household costs. Receive grant linked to proportion of crown estate income. How will the Queen survive?
* Decentralisation - recognises not all services need be provided by govt but can come from private or voluntary providers. Green light for further privatisations.
* Local government - councils face 7.1% reduction year on year. Reducing core grants to councils from 90 to 10. Funding available for council tax freeze. £2bn additional resources for social care by end of 2014-15 period.
* Housing benefits capped and entitlement reduced, new social housing tenants 80% of market rates. Will have the effect of pricing many claimants out of their communities.
* Military - 8% reduction by 2014-15.
* Police -4% reductions year on year without affecting frontline services. Fall by 4% each year. Counter-terrorism being maintained. Home office reduction by 6%. More reforms for streamlining justice system. £7bn budget by 2015. Ministry of Justice also 6% fall.
* Banks face more regulation. Bank of England in charge and independent commission on banking. Implementing code of banking practice which will see banks give up tax avoidance. Additional £900m to go after £7bn in tax fraud.
* Welfare: Crack down on estimated £5bn fraud. Pensionable retirement age of 66 brought forward to 2020 to save £5bn. Staggered increased progressive employee contributions to public sector pensions. £1.8bn savings 2014-15. 12 months limit for sickness benefit not deemed incapable of work. £2bn universal credit fund to make it work. Savings from cap on benefits at average wage resulting in a total welfare saving of £7bn savings.
* Universal benefits: No further change to child benefit apart from higher rate tax payers - £2.5bn saving. Keep universal benefits for elderly. Permanent increase in cold weather payments.
* NHS: Total health spending to rise above inflation. £114bn budget by 2014-15.
* £1.5bn Equitable Life pay out.
* Dept Business: Costs to fall by 7.1%. Maintain Post Offices, support for students. £4.6bn science funding frozen maintained by finding £320m worth of savings. £1bn committed to carbon capture and storage project. Another £1bn to offshore wind farms. £1bn green bank. 'Green Deal' incentives.
* Culture media and sport: 19 quangos to go and budget 15% reduction over four years. 41% admin costs reduction. Free entry to museums and galleries maintained. BBC to fully fund World Service and Monitor, and part fund S4C. Frozen license fee for six years. BBC to face a 16% budget saving in line with govt departments. Reducing online spend, no encroachment into local media markets, and contribute to superfast broadband.
* Dept of Transport: invest £30bn over next four years.
* £1bn regional growth fund.
* Schools budget rising from £35bn to £39bn. Replacing EMAs with targeted support. Five education quangos, to be scrapped with a one third reduction of admin. Money to be found for a £2.5bn pupil premium.
In his bullish reply, shadow chancellor Alan Johnson rightly labelled the Coalition cuts programme a "reckless gamble". In addition to the 490,000 public sector job losses, according to Price Waterhouse Cooper a further half million private sector jobs are at risk. Furthermore for every 100,000 lost jobs there is - assuming those people claim JSA - an additional half a billion cost.
Despite Coalition rubbish about being "all in it together" this is a budget whose consequences fall disproportionately on working class shoulders (and working class women at that). To pretend a top banker or tax-dodging business owner might have to take one less holiday, an extra new car, or an additional summer home is in the same league as being turfed out of your community because of housing benefit changes or losing your job because it's "redundant" is risible and deeply insulting.
The Tories and LibDems are pleased as Punch with their work. But the cuts are not inevitable. The labour movement can defeat these cuts not because it's the right thing to do, but because it's necessary.