Osborne told lawmakers on Wednesday that the lower than expected spending on the Afghan war would help Britain reduce its deficit Press TV reported.
“As the prime minister made clear with the US president last week, UK forces will cease combat operations by the end of 2014," Osborne said.
“As a consequence, I can tell the House that the cost of operations -- which are funded by the government's special reserve and entirely separate from the defense budget -- are expected to be a total of £2.4 billion lower than planned over the remainder of the parliament.”
Osborne said some of the savings would go towards an extra £100 million of improvements to the accommodation of British soldiers’ families, while a grant paid to families while troops are deployed would be doubled.
According to official figures released by the website icasualties.org, a total of 405 British soldiers have lost their lives in war-battered Afghanistan since the US-led invasion of the country in 2001.
Britain reportedly has around 9,500 military servicemen in Afghanistan, making it the second largest force in the country after the United States.
The British government has been under pressure to detail its withdrawal strategy but has refused to set out its plans until the United States makes a decision.
Insecurity continues to rise across Afghanistan despite the presence of some 130,000 US-led forces in the Asian country.
The United Nations announced on February 4 that 2011 was the deadliest on record for Afghan civilians. The death toll rose eight percent compared to the year before and was roughly double the figure for 2007.
Overall, 3,021 civilians died in violence related to the war and 4,507 were wounded in 2011. Of the deaths, the UN attributed 77 percent to militant attacks and 14 percent to US-led foreign troops and Afghan forces. Nine percent of the cases were classified as unknown.
Source : Afghan Voice Agency (AVA), Kabul