Finance minister George Osborne said nearly half a million public sector jobs would go as a result of the austerity measures, and the age at which state pensions are paid to men and women would rise to 66 by 2020.
Osborne insisted that the 83-billion-pound (130-billion-dollar, 95-billion-euro) package -- watched around Europe by governments with similar deficit worries -- marked "the day that Britain steps back from the brink."
"This coalition government faced the worst economic inheritance in modern history," he added. "A stronger Britain starts here."
Prime Minister David Cameron's Conservative-Liberal Democrat coalition came to power in May saying it had to take drastic action to eliminate Britain's record 154.7-billion-pound deficit -- a legacy of the previous Labour government.
The opposition, unions and some economists say the cuts are a gamble that could plunge the world's sixth largest economy economy back into recession.
Osborne confirmed the government would cut 490,000 public sector jobs over four years -- from a total of around six million -- adding that the job losses were "unavoidable when the country has run out of money".
Government departments are facing average cuts of 19 percent over four years except health and overseas aid, which are ring-fenced. They are lower than the expected 25 percent.
The Foreign Office will have 24 percent slashed from its budget, police spending will fall by four percent each year and the Home Office and Ministry of Justice will each fall by six percent a year.
Some of the biggest cuts are being made in welfare, which accounts for around a third of government spending. Osborne unveiled savings of seven billion pounds a year.
He confirmed child benefit will be cut for many higher earners, while raising the state pension age is... [continues]
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