The 80:20 rule applies to the government's austerity policies: about 20% of the Treasury plan for rebuilding public finances rests on tax rises, while 80% comes from reductions in spending.
In the current phase, welfare spending faces the biggest squeeze.
Back in 2010, in the immediate aftermath of the general election, all eyes in the coalition were on the figure for annual public sector net borrowing. This measure shows how much debt is added to the government's mountain of IOUs each year.
It was expected to fall only marginally from the record £156bn set in 2009 by the Labour administration. The cabinet agreed a plan to bring the annual overspend down from almost 12% of GDP to less than 3% by 2015-16, which was two years faster than Labour believed possible.
Tax rises were the first to take effect. An increase in VAT to 20% was allied to a rise in capital gains tax and a £2bn levy on the banks. George Osborne also implemented Labour's 50p top rate of tax for people earning more than £150,000.
In the slipstream came cuts to Whitehall and local authority spending designed to help the government achieve budget cuts – after inflation – averaging 25% over four years. Health, education and international aid budgets were spared the axe, leaving other departments to take even bigger hits. Public sector workers suffered a pay freeze and then a 1% cap.
Osborne planned to impose drastic cuts on welfare spending in 2013, but he expected the economy to be in better shape. In 2010, many analysts said the government's hope was that a recovery would be in full swing by this year and welfare cuts would be quietly forgotten.
However, two key elements of the Treasury's plans have gone awry. By 2013 the economy was supposed to be 6.3% larger, but instead it delivered a double-dip recession and over 2011 and 2012 in effect flatlined.
With growth nonexistent, tax revenues were lower than expected and it became harder to reduce government spending. The Treasury's independent forecaster, the Office for Budget Responsibility (OBR), expected the annual deficit to be £89bn in 2012-13 and then £60bn in 2013-14. In his most recent budget Osborne conceded that borrowing would be £120bn in both years, adding to a debt accumulator total that most experts believe will be £250bn higher than the OBR expected to be run up over five years when the plan was hatched in 2010.
Another element, the cost of implementing Iain Duncan Smith's universal credit, which has needed considerable funds for new computer systems and administration before the largely online scheme begins to save money, was initially underestimated. It is due to go live for new claimants in October, but three out of four "pathfinder projects" were delayed last week and the October start date may also be deferred.
In the meantime, the government has saved £432m by cutting 10% from the council tax benefit grant to local authorities. The Resolution Foundation thinktank believes the move, which scraps the grant and replaces it with a payment worth 90% of its value, will hit 3.2m low-income households who pay no council tax or a reduced charge.
One of several benefit cuts to take effect from April 6 – which include the cut to child benefit for higher-rate taxpayers, reductions in disability living allowance, housing benefit cuts and a 1% cap on annual rises in benefit payments – council tax benefit cuts are designed to push government spending to less than 40% of GDP from a peak of 48% in 2009.
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