Budget 2010: Public-sector pay frozen for two years

A two-year freeze on public-sector pay, departmental cuts of around 25 per cent and hikes in VAT and capital gains tax were the highlights of the first budget of the coalition government.

In what he described as an “unavoidable budget” which would be “tough but fair,” Chancellor George Osborne laid out a plan for deficit reduction that he said was based on 77 per cent spending cuts compared to 23 per cent tax rises.