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Eurozone Austerity Measures: A Round-Up

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* Chancellor Angela Merkel said her government aims to save around €80bn between 2011 and 2014 and get the German budget deficit below European Union limits by 2013.

* The cabinet agreed a package on June 7 which will slash welfare spending by €30bn over the period, cut public sector payrolls by up to 15,000 by 2014, and raise new taxes on nuclear power plant operators and air travel.

* The government also hopes to realise some €5.5bns through subsidy cuts, and raise around €2bn per annum with a financial transaction tax. Berlin is also considering cutting the armed forces by 40,000.


* Prime Minister Jose Socrates told parliament on June 4 that Portugal was on track to meet its buget deficit goals for the year.

* Socrates and opposition leader Pedro Passos Coelho drew up steps on June 3 to slash the budget deficit, including 5pc pay cuts for senior public sector staff and politicians, and increases in VAT sales tax, income tax and profits tax ranging from 1pc to 2.5pc.

* The cabinet approved the programme on May 20. The government said it aims to save €2bn this year in order to cut the deficit to 7.3pc of GDP in 2010 and 4.6pc in 2011. In 2009 it hit 9.4pc, prompting a sell-off of Portuguese assets by investors.

* A June 3 vote was on the general guidelines of the measures, which under Portuguese parliamentary procedure is subsequently followed by a detailed line-by-line vote of each item. That vote is scheduled for June 9 but with the guidelines approved the total amounts of the plan cannot change.


* Prime Minister Jose Luis Rodriguez Zapatero announced on May 12 fresh spending cuts totalling €15bn in 2010 and 2011. Civil service salaries will be cut by 5pc in 2010 and frozen in 2011, while more than €6bn will be cut from public investment.

* The cuts are aimed at speeding up fiscal consolidation and meet Spain's revised deficit targets of 9.3pc of GDP in 2010 and 6pc in 2011, compared with 11.2pc in 2009.

* Public debt as a percentage of GDP is seen at 65.9pc in 2010, rising to 71.9pct in 2011.


* On May 25 a cabinet meeting approved a €24bn deficit cut and measures such as delaying retirement dates by between three and six months, a state salary freeze and cuts to the pay of high public sector earners.

* Regional and local governments will be pressed to contribute some €13bn of spending cuts in 2011-2012, sources said, almost inevitably affecting schools and hospitals. Busy arteries such as Rome's ring road may become toll roads.

* Though Italy kept its budget deficit down to 5.3pc of GDP last year – well below the EU average – the budget aims to slash it to 2.7pc by 2012.


* President Nicolas Sarkozy has said France will look to restore its public finances as the economic recovery takes root.

* In an effort to keep a lid on the budget deficit, France has said it will freeze all spending, except pensions and interest payments on government debt, between 2011-2013 and cut state operating costs by 10pc over the same period. Mr Sarkozy has said this does not amount to an austerity plan.


* An International Monetary Fund mission will hold talks with Greek authorities from June 14 to June 18 in Athens.

* Greece has approved a pension reform bill, after agreeing with the European Union and the International Monetary Fund a fresh set of austerity measures aimed at pulling the country out of a severe debt crisis that has shaken the eurozone.

* Under the EU-IMF deal, Greece plans to narrow its budget shortfall from 13.6pc of GDP in 2009 to 8.1pc this year, 7.6pc in 2011 and 2.6pc in 2014.

* Austerity measures include a public sector pay freeze until 2014. Public sector allowances are cut by an additional 8pc. These allowance were cut by 12pc under a round of austerity measures announced in March.

* The main VAT rate is increased by 2 percentage points to 23pc. Excise taxes on fuel, cigarettes and alcohol are increased by a further 10pc.

* The government has said it will freeze pensions in 2010, 2011 and 2012. The statutory retirement age for women is set to be raised by 5 years to 65 to match the retirement age for men.


* The government's budget for 2010 presented in December projected a deficit of 11.6pc of gross domestic product. The median forecast of analysts polled by Reuters is for Ireland's budget deficit to come in at 11.5pc.

* Three austerity budgets presented in little over a year: in Oct 2008, April 2009 and Dec 2010. With the first two budgets focused on tax rises, December's budget for 2010 drew most praise as it delivered spending cuts of €4bns, including a cut in public sector pay.

* Fresh savings of €3bn planned for each of 2011 and 2012.

It's contained, to at least seven countries possible more but there participation is still yet to be confirmed to this contained problem....

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UK, a little more than £6bn needs to be stripped from the budget.

Also budgets are going to be reviewed by Europe - in fact they are gunning for budgets being reviewed before they even get submitted to parliament.


George Osborne: Ministries face cuts of over 20%

Welfare, tax credits and pensions among areas to be included in fundamental spending review, warns chancellor

George Osborne The chancellor said ministers were involved in 'a fundamental reassessment' of the way government worked. Photograph: Chris Ratcliffe/Reuters

Cuts in departmental spending, including some in welfare, tax credits and pensions, will total more than 15-20% through this parliament, the cabinet was warned today by George Osborne.

Edited by OnlyMe
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A man buys a house in 1999 for £20,000. He paints it white from the previous colour. He sells house for £40,000.

Another man buys the house and does the same and sells it for £60,000 and so on and so forth.

Eventually a man buys the house for £200,000 on a 100% self cert mortgage and cant pay. Multiply this by several hundred thousand around the world and the banks are bankcrupt.

Government get into debt to bail out the banks.

The banks start buying shares and slowly lend money, this time more sensibly.

Goverment cant pay its debts, because investors (the banks), keep raising the interest on the debt, that was taken on by the government to bail out the banks that are insisting the debts be paid quickly.

I dont know about "new world order", I do say I think I prefer the Chinese system of Goverment.

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  • 429 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
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      • Even
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      • up 5%

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