A Conservative MP has admitted that there will be “pain across the public sector”, even in areas protected against spending cuts.

Greg Hands (pictured), shadow minister for the Treasury, speaking at the NCVO/Guardian Breakfast Seminar this morning, said that while certain areas such as the NHS are protected against funding cuts, even they will not be immune from reforms.

“Even in protected budget areas that doesn’t mean there will be no changes,” he said.

Funding via loans

A Conservative government would use “loans as well as grants” in funding charities, said Hands, “to break the culture of organisations being dependent on government for hand-outs.”

Upon questioning Hands, who does not have any specific responsibility for civil society issues, said he did not think there was a “prescriptive plan” for when a Conservative government would issue a loan as opposed to a grant. He emphasised that shadow ministers are “keen to diversify [and] give ourselves a little bit more flexibility”.

Hands said Tory policy is to get the budget deficit under control, keep interest rates low and re-diversify the economy. However, the party will not be releasing a draft budget before the election.