The Sun calls it a 'recovery masterplan,' whilst the Guardian says it promises 'pain now, more pain later.' The Daily Mail says that the middle-class will bear the brunt of Osborne's 'savage' budget, and the Financial Times says the package of spending cuts and tax rises is 'Osborne's kill or cure budget.'
Earlier, the Labour party seized on Osborne's decision to raise Value Added Tax (VAT) by 2.5% to 20% from Tuesday 4th January 2011 as evidence that the government's budget will hit the poorest hardest, accusing the Liberal Democrats of going back on pre-election campaigning against a possible rise in VAT by the Tories.
|Chancellor of the Exchequer George Osborne|
and Prime Minister David Cameron
"I'm not going to hide it from you - what the coalition has announced is tough. But let's be clear, it's also entirely necessary and entirely unavoidable. Never forget - Labour left us with one of the worst economic inheritances imaginable. They racked up one of the biggest budget deficits in Europe - with the government borrowing one pound for every four it spends - and they doubled the national debt.
"Giles, in this emergency Budget I believe you have the measure of this government. Will it provoke debate? Certainly. Will it cost our coalition some popularity? Possibly. But is this the right thing to do - for the health of our economy, for the poorest in our society, for the future of our country? I passionately believe it is."