George Osborne has announced another £7 billion of welfare curbs in a cuts package he promised would bring the British economy “back from the brink”.

Unveiling the Spending Review that allocates Government spending from 2011 until 2014/15, the Chancellor said the extra benefits cuts meant he could cut departmental budgets less than Labour would have done.

Mr Osborne had already set out plans to cut the welfare bill by £11 billion by 2014/15.

Today, he said he would cut another £7 billion. He also claimed to have identified an additional £3 billion in Whitehall waste that can be eliminated.

In the biggest change, many claimants of Employment Support Allowance, the main incapacity benefit, will have a one year time limit put on their claims. Around 1 million claimants will be affected, the Treasury said.

The £7 billion of welfare cuts include the controversial decision to take child benefit away from families where one person earns more than £44,000.

Previously, the Treasury had said that would cost families £1 billion a year. But today, Mr Osborne said the measure will actually take £2.5 billion away from parents.

New restrictions on the Working Tax Credit will cut £1.4 billion of spending by 2014/15.

There will also be cuts to Council Tax Benefit (cutting £490 million a year), Disability Living Allowance (worth £135 million a year).

“Today is the day when Britain steps back from the brink,” Mr Osborne told MPs.

He insisted the Coalition will keep to its plans for cuts. “To back down now and abandon our plans would be the road to economic ruin. We will stick to our plans,” he said.

Allocating departmental budgets, Mr Osborne confirmed that health and aid will grow in real terms. All others will have cuts.

Among the biggest losers will be the Ministry of Justice, which faces a 23 per cent cut and will have to close prison places and slash the legal aid budget.

The Home Office is also cut by 23 per cent, raising questions about police numbers. Mr Osborne said he “aimed” to avoid any reduction in the “visibility and availability of police on our streets.”

The environment department will lose 29 per cent and culture will be cut by 24 per cent.

The education department will be relatively protected, taking only a 3.4 per cent cut over four years.

Source: http://www.telegraph.co.uk/news/newstopics/spending-review/8075932/Spending-Review-2010-George-Osborne-announces-further-7bn-welfare-cuts.html