See
here. Cuts predicated on an increase in costs based on a cut in orders from the USAF etc.
SSS, it´s not some much that the engine order has gone to P&W, as the rumour is the QDR budget cancels the production of the GE/RR F136 alternate engine. RR has a work share in both, but will lose a lot of work with the cancellation.
However, the team was awarded a $2.4 billion SDD contract for the F136 in August running up to 2013 covering the production and qualification of 14 engines (seven ground-test, six for flight test, plus a spare), so there is no immediate risk to the programme, plus there is a lot of talking going on at the PM/Bush level. The Congress has a reputation of putting things like this back in as well for their own local industry reasons. I wouldn´t panic yet.