Departments told to draw up plans for 40% spending cuts
BBC
Page last updated at 01:03 GMT, Sunday, 4 July 2010 02:03 UK
The Treasury has told most government departments to prepare "illustrative plans" to cut spending by 40% - as well as the expected 25% - within the month.
Education and defence have been given some protection, and must produce plans to cut 10% and 20%. International aid and health budgets are being protected.
The full 40% plans are unlikely to be implemented but will inform future decisions on cuts, the BBC understands.
Labour says the news will raise fears about the future of frontline services.
'Swingeing cuts'
The government says cuts are needed to reduce the UK's £156bn annual budget deficit - the amount it must borrow each year to plug the gap between public income and spending.
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