London, England (CNN) -- The British government announced deep budget cuts Wednesday, as it tries to fight what its finance minister called "the largest structural budget deficit in Europe."
The changes will include "ruthless privatization" and will leave "no stone unturned in our search for waste," Chancellor George Osborne told lawmakers in the House of Commons.
The government will slash 490,000 jobs from the public payroll over four years, he said.
But the cuts will also be guided by the principle of "fairness," he said, adding that "those with the broadest shoulders will bear the greatest burden."
He specifically named banks when saying "those with the most should pay the most," amid widespread British anger at bankers.
But Osborne's predecessor warned against trying to cut the deficit too quickly.
"If the private sector doesn't come in and take [government spending's] place, you run the risk of derailing the economy," said Alistair Darling, who was chancellor until the Labour Party lost elections in May.
"The risk the new government is taking is ... that you take so much money out of the economy that you end up with years of the economy simply bumping along the bottom," Darling told CNN's "Quest Means Business."
With the European economic situation being "a pretty mixed picture, where is the growth going to come from?" he asked.
Protesters were out demonstrating against the cuts even before Osborne announced them.
"The thing that will most reduce the deficit is seeing a solid recovery in place in economic growth," top union official Brendan Barber said Tuesday.
"That's what will generate tax revenues to bring the deficit down -- not a program that's going to put perhaps a million more people out of work," he said, predicting a "disastrous consequence that will actually make the deficit even worse."
The UK Film Council is one of more than 100 quasi-governmental agencies being eliminated by the government, to the frustration of actor Joseph Kloska, a star of the movie "Made in Dagenham."
"I hope that in a few years' time, I'll be working on a film that tells a story about how we today took on this government, took on this government, and we won," he told CNN.
He insisted that backing moviemaking generates revenue for the government.
"For every pound that the UK Film Council has invested, they get a return of five, which is extraordinary in the current economic climate," he argued. "So in terms of of the economy, it's a tiny, tiny, tiny fraction of public spending, but in return it generates over a billion pounds for the Treasury."
The long-awaited cuts follow a "comprehensive spending review" by the new British government, which came to power in May.
Paying interest on government debt currently costs 44 billion pounds ($69 billion) a year, the Treasury said in outlining the spending review -- more than defense, policing, housing or transportation.
The government forecasts public spending peaking this year, then falling to 2003-04 levels by 2015-16. That will still not quite balance the budget, it predicts, but will come close to doing so.
It announced deep cuts to the defense budget on Tuesday, with the armed forces losing 10 percent of uniformed personnel in the next five years.
But not all areas are facing the axe.
The government promises to continue increasing spending for the National Health Service every year, and to spend 0.7 percent of GDP on overseas development aid by 2013.
Other European governments, including those of Germany, Greece and Spain, are also cutting spending amid the global recession, and France has seen massive nationwide demonstrations over the past month as the government there tries to reform the pension system.
CNN's Ayesha Durgahee contributed to this report.