Osborne offered to reopen wealth taxes debate in exchange for more welfare cuts

The next few days in Whitehall are going to be dominated by the remaining bits of the spending review. The Treasury remains confident that it will wrap everything up with relative ease, BIS seems to be the only department still causing genuine concern. But given that Cable is the left tent peg of this coalition that is a major problem.

But there are, I understand, going to have to be some cuts made that the coalition would rather have avoided. This is, in large part, due to the fact that because of Nick Clegg’s veto Osborne got £6 billion less out of welfare than he wanted. I understand that Osborne was so keen to cut welfare rather than departmental spending that he offered to reopen the wealth taxes debate. Clegg, however, refused.

Clegg’s refusal has interesting implications for any post-2015 coalition. The Tories are determined to avoid more tax rises, which means that they’ll have to be a lot more spending cuts.