05/12/2012 14:02 GMT | Updated 05/12/2012 14:05 GMT

Autumn Statement: Austerity Could Cost 1.1m Public Sector Jobs, Watchdog Warns

Austerity measures could mean a million public sector jobs disappear by 2018, according to the budget watchdog.

In the Chancellor's Autumn Statement, George Osborne was forced to admit that the independent Office for Budget Responsibility now believes he will miss his target for debt to start falling as a proportion of GDP from 2015/16 - the year of the next general election.

The OBR downgraded its forecasts for GDP growth in each of the next five years, predicting that the economy will shrink by 0.1% in 2012, rather than growing by 0.8% as they expected in March.

According to the OBR, about 1.1 million public sector jobs will be lost "reflecting the additional year of spending cuts pencilled in for 2017-18".

Its prediction in March had been for around 730,000 such jobs to be lost, of the 5.5 million currently employed by the public sector.

TUC general secretary Brendan Barber said: "The Chancellor’s economic medicine isn’t working, but that hasn’t deterred him from continuing a course of action which is dragging the economy down and piling on the misery for families across the UK.

“Hundreds of thousands of public sector workers have already lost their jobs as local authorities, government departments and hospitals have been forced to slash their spending.

"Now it seems we’ve barely begun to suffer the pain and many more households will experience the despair and hopelessness of unemployment over the next few years.

“Ordinary families are being hammered by the biggest squeeze on their incomes in a generation as wages fail to keep up with prices and freezes and cuts to benefits make a huge dent in family finances.

“But for those with one or more family member working in the public sector – or who rely heavily on public services – the Chancellor’s austerity drive promises a particularly bleak future.

“Millions of people already struggling to get by will now be living with the constant fear that it could soon be their job which is added to the hundreds of thousands of public sector jobs already axed.”

"When you are self-harming you should stop, not look for better sticking plasters.

"With the economy still scraping along the bottom, unemployment set to rise and the Chancellor missing his own debt target, we need a fundamental change in direction, not more muddling through."