A highly-respected think has criticised George Osborne for not explaining how he wants to cut an extra £12bn from welfare as it warned that the poorest have been hardest hit by the Chancellor.

 

The IFS analysis raised questions about the Tory-Lib Dem Coalition's claim of being "in it together" on austerity.

There was good news for the Chancellor as it backed his boast that ordinary people were better off now than five years ago.

But also cheer for Labour with a prediction that the party could stop cutting public spending, and meet its own targets, within just one year if it wins May's election.

The poorest were the biggest hit as a proportion of their income, the think tank said.

The IFS said that it was striking that middle-earners, and those just above them, had been largely protected by the Coalition's tax and benefits changes.

It also attacked Mr Osbornes controversial plan to give would-be first time homeowners an extra £50 for every £200 that they save.

The policy was "unfunded" and would have to be paid for by so far unspecified cuts in other areas, it said.

Later a Tory Treasury minister confirmed his party would not say how it wanted to swing the axe until after the General Election.

A forecast from the independent Office for Budget Responsibility (OBR), published alongside the Budget, suggested that Mr Osborne's new plan to end austerity a year early, and "frontload" more cuts, would mean a "rollercoaster" ride for public services.

Official analysis of the Budget also showed that Mr Osborne's planned cuts over the next few years would be much deeper than they have been in any of the last five.

But the Tories insist this gives a skewed picture, and does not include their planned £12 billion welfare cut.

IFS director Paul Johnson urged the Chancellor to be more clear about his plans.

He said: "The Chancellor argues that because he is committed to £12 billion of welfare cuts and £5 billion of anti-tax avoidance measures, the required cuts to public service spending are much more modest.

"But if he really wants us to believe that, he needs to be more explicit about how he actually thinks he can cut welfare spending and raise substantial additional sums from clamping down on tax avoidance.

"My guess is that even under a majority Conservative government, annual cuts in public service spending will not turn out much more dramatic than those we have seen over this parliament.

"We won't be on the OBR's rollercoaster. But it is a terrible shame that, despite all the mass of information... I am left guessing.

"Whitehall departments are going to have to plan for some dramatically different scenarios, one of which they will have to implement in just 12 months ' time."

Mr Osborne had said in his Budget speech that he was taking Britain "one more big step on the road from austerity to prosperity".

Mr Johnson added that their latest estimates "suggest that Labour would be able to meet its fiscal targets with no cuts at all after 2015-16."

The IFS also looked at the rival claims that households are now £900 better off or £1,600 worse off than when the Tories came to power in 2010.

Mr Johnson said there was "truth in both numbers" , but added that "real incomes should be above their 2010 level as Mr Osborne says."

Responding to the IFS analysis, Mr Miliband said: "We now know this is a Budget which will bring public services to their knees."

He said it was clear the Chancellor's plans would deliver "cuts in the coming years twice as deep as any we have seen".

Earlier, shadow chancellor Ed Balls had surprised some by saying there was nothing in the Budget "I would reverse",

SNP Deputy leader Stewart Hosie said the comments "confirmed there would be no respite for Scotland by agreeing with the proposed Tory cuts".

Scottish Labour Leader Jim Murphy said:"When it comes to Tory cuts, George Osborne's Budget confirmed what we already knew - that the worst is yet to come."

In Brussels for a European Union summit, Mr Cameron hit back accusing the other parties of wanting to take Britain "back to square one".