"It's against a backdrop of hugely successful, record investment - over 25% more today than 1997 - and the resilience within the sector we have nurtured, that we (are) now able to look to the higher education sector to tighten its belt in the coming period, " he said.

BBC: Top UK universities warn of damage from budget cuts

But after having put out the fire of an imploding global financial system, the public sector is also tightening its belt.

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In Russia, which now vies with Saudi Arabia to be the world's biggest oil producer, there are signs that President Vladimir Putin, who has recently consolidated the state's grip on various parts of the energy sector, may loosen the budgetary belt.

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Amid speculation about industrial action in response to public sector job losses, Business Secretary Vince Cable has drawn attention to what he says was the responsible attitude of unions to belt-tightening in the private sector.

BBC: Unions urge different approach as cuts debate continues

In December's pre-Budget report, Labour announced belt-tightening measures including a 1% cap on public sector pay rises and an increase in National Insurance from 2011.

BBC: Shadow business secretary Ken Clarke