The job losses in the public sector will result from the 25% inflation-adjusted reduction in Whitehall spending over the next five years,
I\’\’m not sure they have.
The 25% cuts are nominal cuts. Cuts from the planned future spending as upgraded for inflation, expansion of government, population growth and so on.
An \”inflation-adjusted\” reduction would be a reduction in cash terms wouldn\’t it? And we\’re not actually having one of those. Cash spending will still rise.
So I think the Guardian has got this entirely the wrong way around. The 25% cuts are NOT inflation adjusted, rather than being inflation adjusted.
Or have I got confused here?
Hmm, Larry Elliott tells me I\’m wrong via email:
No the real terms cut is 25 pc. The nominal reduction is much smaller, a point made quite forcefully by Reform and the Institute for Economic Affairs
Clearly I need to think about this a little more, silly Timmy. For I fear that Larry is right and Timmy wrong here.