Spain's Unemployed Speak Out on Budget Cuts
Al Jazeera's Barnaby Phillips speaks to two of the country's approximately five million unemployed about what they think of the latest round of cuts.

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Spain Unveils Deep Budget Cuts
Spain's government has announced $36 billion of tax rises and spending cuts as it tries to avoid a bailout.

Analysis: VAT and Cuts Spell Trouble for Clegg
THE TIMES: Ministers from both sides of the coalition were quick to talk up the Lib Dem Budget wins, including the £1,000 increase in the starting rate of income tax and the £150 one-off payment for poor families.

But the Lib Dems could be forgiven for a tinge of self loathing every time this is described as a “progressive” budget, as they weigh the concessions made to them against the package of horrors they must now defend.

The pictures of Nick Clegg standing in front of the anti-Tory “VAT bombshell” posters last night were gruesome enough. The Treasury graphs showing the increased burden felt by the poorest in society are even worse.

But the real challenge for the Deputy Prime Minister, and Danny Alexander, the hastily appointed Chief Secretary to the Treasury, is that a sizeable number of Lib Dems disagree with the single biggest decision underpinning yesterday’s statement - the scale and speed of the cuts.

George Osborne revealed yesterday he wants to extinguish the structural deficit and be in surplus by the end of the Parliament with a combination of £8billion tax rises, £32billion spending cuts and £11billion welfare cuts by 2014.

The Chancellor called this “unavoidable” action needed to calm the market. But Lib Dems - and some in the markets - dispute this. The markets worry the scale of the action make tip Britain back into recession. Lib Dems point out many other countries maintain their AAA rating without paying off “every last penny” of the structural debt - money which could go to help the most vulnerable in society. Read on and comment >>> Analysis, Sam Coates, Chief Political Correspondent | Wednesday, June 2010

Cameron: 'Years of Pain Ahead'
THE SUNDAY TIMES: DAVID CAMERON has warned that the economy is in a far worse state than previously thought and signalled that Britain faces years of “pain” as the spending axe falls.

The prime minister indicated a sharp downgrade in official growth forecasts and revealed that welfare and public sector pay would bear the brunt of budget cuts.

It is understood that tough measures being considered to help control the £156 billion budget deficit include benefit freezes and cuts in child tax credits. There are also likely to be below-inflation pay rises for state employees on top of next year’s planned freeze.

In an interview with The Sunday Times, Cameron said: “Proper statesmanship is taking the right action, explaining to people the purpose behind the pain.”

The prime minister said there would be no “trampoline recovery” of the economy. He warned there was a “serious problem” with forecasts inherited from Labour of robust 3% growth next year.

“There is a huge amount of debt that has got to be dealt with. Crossing our fingers, waiting for growth and hoping it will go away is simply not an answer,” he said.

“The country has got an overdraft. The interest on that overdraft is swallowing up things that the nation should otherwise be spending money on. We have got to take people with us on this difficult journey.” Read on and comment >>> Jonathan Oliver, Political Editor | Sunday, June 06, 2010