Chancellor Sajid Javid announced the latest Spending Review on 4 September 2019.
This review is in reality a fast-track Spending Round concerned with government spending for 2020/21.
The Chancellor has delayed his full three-year Spending Review until 2020.
An overview of the spending review
The Chancellor announced a “decade of renewal” that would “turn the page on austerity”, with a focus on delivering on public priorities including health, education and security.
This Spending Round included short-term funding boosts for public services to the tune of £13.4 billion.
And, for the first time since 2002, no government department will see a cut to their day to day budgets.
These are the fastest planned increases in day-to-day spending for years, and include:
- Increase in the allocated minimum spend per child in secondary schools to £5k by 2021, and £4k for primary school pupils
- £400 million to train over a million 16-19 year olds in skills for employment
- Cash increase for the NHS of £33.9 billion a year by 2023/24
- Additional £1.5 billion for social care
- 20,000 more police officers
- 10,000 more prison places, along with a programme of work to improve security
- £2.2 billion for the armed forces
- £200 million to transform the country’s bus services
Sounds like good news …
At first glance, this renewed commitment to public services looks like a good thing.
But experts are suggesting that the news might not be quite as positive as they appear.
For example, it’s claimed that the promise of 20,000 new police officers actually simply replaces some of the 20,000+ officers that have been cut since 2010.
Similarly, the extra money allocated to social care actually represents the bare minimum requested by local authorities to try and secure parts of the system collapsing in the coming months.
A short-term approach to long-term concerns
The decision to take a short-term approach and push back the full Spending Review until 2020 is considered by some to be a ‘sticking plaster’ approach.
Experts at the CIPFA have suggested that this extra spending across public services represents an increase in government borrowing and isn’t sustainable for the long term.
The ongoing uncertainty around Brexit
With a no-deal Brexit still looming, we don’t fully understand the cost of the UK’s departure from the EU, and there are growing concerns that this approach means the public sector taking on a higher debt in a time of significant uncertainty.
The Chartered Institute of Public Finance & Accountancy (CIPFA) are worried that this approach sees the government spending the three-year Brexit contingency fund in just one year.
With the possibility of a General Election at the forefront of many minds, experts wonder how this could affect the long-term stability and prosperity of the country.
More money to spend on vital technologies
This spending review has confirmed that the public sector must continue to find ways to save.
Investing in technologies such as Robotic Process Automation and Artificial Intelligence is the right way forward.
These vital technologies are rapidly changing the workplace and offer a variety of opportunities – from significant savings to improvements in how staff experience the workplace.
Automating mundane, repetitive tasks frees up staff to undertake richer, knowledge-based tasks.
Knowing (in the short term, at least) that government departments won’t be facing any budget cuts means we can move forward with current and proposed RPA and AI projects.
Saving departments significantly in the long run, but also that help increase productivity and workplace engagement.