By the end of 2013, the UK government will have implemented 52% of planned fiscal consolidation.
The IFS report that most of this fiscal consolidation has come through taxes. In coming years, we will see the impact of cuts to the benefit budget. Only 58% of the total cuts to benefit spending have been implemented, and only 31% of overall cuts to other spending (non-investment) have been achieved. (IFS fiscal squeeze)
One consequence of this is that there is likely to be an increase in income inequality from 2013-14, as low income groups experience the impact of the benefits squeeze.
Timing and composition of UK Fiscal consolidation
The good news is that 90% of public investment cuts have been implemented, and in the latest spending review, the government has pledged to increase public investment.
Nominal Government Spending
|total government spending £ bn||% change|
source: UK public spending