Think-tank warning over Darling PBR
Chancellor Alistair Darling will have to find an extra £76 billion, or £2,400 per family, to restore the public finances over two Parliaments of pain, experts warned.
The influential Institute for Fiscal Studies' (IFS) analysis of the Pre-Budget Report said one third of the sum would be clawed back through tax rises and two thirds through spending cuts by 2017/18.
The IFS also warned that debt levels could remain high "for a generation" - at around 60% of national output - without policies to tackle the impact of the ageing population on the UK's public finances.
The institute also warned of £36 billion in departmental spending cuts in the three years to 2014 implied by the detailed Pre-Budget figures - £15 billion more than accounted for in the efficiencies and cost savings announced so far.
Between 2011 and 2013 pledges to protect health and education spending as well as meet overseas aid commitments meant total cuts of £25.5 billion - or 6.4% - for other departments, the IFS said.
It predicted "severe cuts" elsewhere, potentially across departments such as housing, transport, higher education and even defence.
The clampdown could even mean that all of Labour's increase in public spending since it came to power could be unwound by 2018.
The IFS also estimated that the Chancellor only had a "six in ten" chance of complying with his own legal responsibility to cut the deficit within four years, based on the accuracy of Treasury forecasts in previous years and no further policy tightening.
But the body had better news for the Chancellor after studying the figures, despite the record £178 billion in borrowing forecast for the year.
The IFS economist Carl Emmerson said: "More of the borrowing is thought to be temporary rather than permanent, and that means that a smaller repair job is needed over the next few years to put the public finances back on track."
