Page last updated at 09:20 GMT, Monday, 22 February 2010

Heavy cuts to continue on Isle of Man

Allan Bell MHK
Treasury minister Allan Bell said front line services will be protected

Cuts and job losses in this year's Isle of Man budget were "only a taste of things to come" in tackling a massive deficit, it has been claimed.

Treasury minister Allan Bell warned the government will need to save £50m to fill the hole in the economy caused by the VAT agreement with the UK.

A five-year plan has been created to ensure finances are stabilised.

Last week's budget saw the axing of 99 civil service jobs and a rise in income tax and electricity prices.

Mr Bell said: "We have decided to spread the re-balancing that's necessary over a five-year period and make use of all resources to us - in particular protecting the economy.

"Next year, with the aim of protecting front line services, there will be further reductions.

"The second part of the VAT reduction kicks in and we'll have to find a further £50m which is going to be very difficult."

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