Total public spending to rise 2% in 2015-16 on previous year

 

      The slim Green Book reveals that total spending will increase 2% in 2015-16 over 2014-15. Within this pensions and welfare spending is forecast to rise  by £15.3bn or 4.45% (AME) whilst departmental expenditures will decline by just  £0.9 bn.(DEL including depreciation).

       The Green book suggests that this will be a real terms reduction of 0.4%. However, with a continuing wage control allowing only 1% pay growth, with productivity gains and with proper control of general inflation, these figures could end up delivering a small real terms increase if properly managed.

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24 Comments

  1. lifelogic
    Posted June 26, 2013 at 3:00 pm | Permalink

    So much that could be usefully cut, so many overpaid staff, so many doing nothing of any real use and so many doing actual harm. Yet this is the best Osborne can do? They could cut expenditure be 10-20% at the drop of a hat, without anyone even noticing. Cut out the ones doing positive harm and there is a double pay back anyway.

    • Jerry
      Posted June 26, 2013 at 4:30 pm | Permalink

      @Lifelogic: Really Mr Logic, sometimes you really don’t think your rants through, yes lets sack all these staff but what would it save? First off there would be redundancy payments to fund, then perhaps the need to fund a re-training scheme, and then there is likely to be (at least for sizeable number) the need to pay on-going out of work welfare – of course I know you would love the law to be changed so that those being sacked would have no recourse etc. and no one could claim welfare (or if they can, only be able to do so for a very sort period) but that is not were the country is and is not likely to be any time soon if ever.

    • Bazman
      Posted June 26, 2013 at 6:50 pm | Permalink

      The amount of money lost to the economy by the cuts to public spending and the resulting benefit bill might be a factor. Are you seriously telling that there is no knock on effect from cutting public spending and increasing the number of zero hour contracts within the private sector. Have a ‘Think’ about your views and get back to us.

    • Hope
      Posted June 26, 2013 at 9:44 pm | Permalink

      And the majority of MPs passed the HS2 project for the EU that is already projected to be £10billion over its predicted budget. Now that is economic madness for you. Osborne claimed to have a balanced structural budget by 2015. However he seems to have forgot you need to make spending cuts to achieve that aim. Searching every corner of the world for tax will not cut the mustard. How about the 80/20per cent claim he made? How this that coming along? Over 299 tax increases it appears it is about 100 per cent tax rises to nil spending cuts. I hope the electorate votes with their feet, we cannot afford Osborne economics.

      Reply Most MPs do support HS2. I did not vote for it, as I think it is too dear.

  2. ian wragg
    Posted June 26, 2013 at 3:14 pm | Permalink

    There should be an immediate ban on recruitment in the public sector and every department forced to terminate all non jobs. Climate change officers, outreach workers and all the other nonsense we pay for. Starting at the top all salaries should be audited and brought back under control.
    All public sector pensions above £15,000 per annum should be halved as in the private sector.
    The gravy train at taxpayers expense must be derailed and pretty quickly.

  3. uanime5
    Posted June 26, 2013 at 4:02 pm | Permalink

    The proposed welfare reforms seem more like a desperate response to the failure of the Work Programme, rather than anything that will get people into work.

    Firstly as the role of helping people get into work has been outsourced to the Work Programme all the Job Centre does is check that people are applying for jobs. So having people go to the Job Centre weekly, rather than fortnightly, won’t make them more employable. I expect this plan will be dropped when someone realised how much it will cost to effectively double the Job Centre’s workload.

    Secondly the unemployed can’t claim for the cost of going to the Job Centre so it will be an additional burden on them for no extra benefit.

    Thirdly given how useless the current Government controlled Job Search website is I doubt that making this mandatory will help anyone find work. Especially when it only contains a small percentage of the total jobs available.

    Fourthly a welfare cap will be useless as long as the cost of renting, and thus the cost of housing benefit, continues to rise.

    • Jerry
      Posted June 27, 2013 at 11:21 am | Permalink

      @U5: Indeed, regarding JCP staff numbers, even more so when the DWP were attempting to decrease the number of (front of house) staff. In fact the requirement for (some) claimants to attend the JCP weekly also seems to suggest that the computer system that IDS has been trumpeting (Universal Job Match) with its very questionable tracking of claimants use of the website is starting to hit the buffers, both due to the fact that many people can’t access the internet on anything like the regular bases (if at all) that IDS expected, and the fact that both UK and EU law allows people to opt out of sharing such internet data with the DWP. How much has IDS wasted on a system that many could have told him would not and could not work?…

  4. Lindsay McDougall
    Posted June 26, 2013 at 4:06 pm | Permalink

    I liked Liam Fox’s idea of freezing public expenditure in cash terms for 5 years. Whatever happened to that? Perhaps it could be applied between 2015 and 2020.

  5. Lindsay McDougall
    Posted June 26, 2013 at 4:10 pm | Permalink

    Did anybody see the results of a poll in which 56% of pensioners accepted that they should feel some of the financial pain that everybody else is feeling? That challenges some of the conventional wisdom about not upsetting the grey vote.

    • Jerry
      Posted June 27, 2013 at 11:26 am | Permalink

      @Lindsay McDougall: Ask the right question in suitable language and you can even get Turkeys voting for Christmas!

      Of course these 56% of pensioners accept the need, they might even welcome the fact, but that is until someone cuts the service they use… Opinion polls are just another set of statistics, and you know what is said about them.

      • Lindsay McDougall
        Posted June 28, 2013 at 1:17 am | Permalink

        My hunch is that Labour is planning to get the young to vote for them in large numbers by starting a war between the generations. Ed Balls’s recent statement that he would cap pensions may have been the opening shot. It may be too late for 2015 but watch out in 2020, especially if Labour take up the Scot Nats’ idea of votes at 16. The over 65 vote is large and will get larger, but over 65s are still a minority of the electorate.

  6. Denis Cooper
    Posted June 26, 2013 at 4:54 pm | Permalink

    Essentially static in real terms, give or take a fraction of a percent; but if the economy has resumed growth by then it will be down a bit as a percentage of GDP.

  7. Bob
    Posted June 26, 2013 at 6:06 pm | Permalink

    I see that the HS2 budget has had a small adjustment, up 31% to 42 billion pounds.

  8. Martin
    Posted June 26, 2013 at 6:13 pm | Permalink

    Mr Osborne appears to be spending money tarting up a field in Belgium.

  9. Brian Tomkinson
    Posted June 26, 2013 at 6:32 pm | Permalink

    Just like junkies you politicians cannot kick the habit of thinking that you can spend taxpayers’ money better than they can. The prognosis doesnt look good to me after three years of Conservative led coalition. The three main parties in Westminster are virtually the same when in comes to tax, borrow, spend and waste. We are still heading for economic disaster.

  10. Acorn
    Posted June 26, 2013 at 6:58 pm | Permalink

    I have to admire your support for a failed economic strategy JR. Even Friedrich August Hayek gave up with his theory in the end and admitted his theory didn’t work, and Keynes was right all along. Someone should tell George Osborne and the Treasury. Not that it matters, you have got the voters in the “boiling frog” mode and they are too thick to jump out of the water.

    We have had the 2013/14 budget speech, and now the 2015/16 budget speech; I must have missed the 2014/15 budget speech. Meanwhile, the voters are so thick that you could get away with it at the next general election; but, you have to keep pushing that it was all Labour’s fault; the massive deficit etc from bailing out the banks. (Mind you, Osborne would have done exactly the same as Darling did).

    You can’t lose bashing welfare “scroungers” and public sector “cushties”. But you have to keep the Rednecks baying for their blood. It is looking increasingly doable. Meanwhile, the rest of us should think about digging up the lawn and growing our own food again, we are heading back to a subsistence economy.

    Reply: This is not the budget – no statements have been made about tax. This is the Spending Statement, and includes your “missing” year. Government usually publishes several years forward for spending.

  11. Paul
    Posted June 26, 2013 at 7:05 pm | Permalink

    Osborne could do much more on welfare. He says people who can’t speak English will be made to learn English if they want to receive benefits. No, George – if they can’t speak English they shouldn’t be in this country at all, never mind receiving benefits. There will also be a seven day waiting period before you can claim benefits after losing your job. What a ridiculous and pointless idea. How about foreign born migrants who have been unemployed for a year or more have their benefits reduced/stopped? In tough times we need to concentrate on getting our own people back to work.

    • Jerry
      Posted June 27, 2013 at 6:42 pm | Permalink

      @Paul: “if they can’t speak English they shouldn’t be in this country at all, never mind receiving benefits.

      Hmm, what if other countries also implemented such a silly over reaction of a policy in retaliation, sorry Paul but talk about wishing to harming the one you love the most! How many Brits speak any foreign language fluently, what of all the British ex-pat living in EU countries who can’t speak the lingo for example, should they all be forced to return to ‘Old Blighty’?…

      • APL
        Posted June 28, 2013 at 7:42 am | Permalink

        Jerry: “what if other countries also implemented such a silly over reaction of a policy in retaliation ”

        In the news sometime in the last 18 months, the phenomenal sum spent by government, local authorities, Charities ( on the government teat ) on translation services.

        Other countries are unlikely to implement any retaliatory* action, simply because Brits mostly go abroad when they can afford to support their own lifestyle, either business men or retirees. That means these people are an asset to the country they settle in.

        From the off, someone who settles here and can’t speak English probably isn’t self sufficient or in receipt of a pension.

        *But if they do, so what?

        • Jerry
          Posted June 28, 2013 at 4:30 pm | Permalink

          APL: You mean UK ex pats who buy-up the ‘natives’ homes, forcing up the local housing prices at the same time, jobs, services, and what ever else including health services, exactly the same sorts of things that the rabid right in the UK complain about – don’t be to smug, retaliatory action might not be so very far away as you think.

          • APL
            Posted June 30, 2013 at 1:04 pm | Permalink

            Jerry: “You mean UK ex pats who buy-up the ‘natives’ homes, forcing up the local housing prices at the same time ”

            The ‘native’ sells, and is happy to take the excessive amount of money, Jerry. NOBODY forced them to take the money.

            And by the way, the downside that expats are becoming ever more familiar with just now. In, for example, Spain – you can’t sell a house for love nor money. The bottom has dropped out of the market, the ‘native’ has taken the money at the top, and the foreigner is left with an asset liability that he can’t sell.

            I’m not weeping any tears for those fellows, by the way.

            But by comparison your average immigrant in the UK, arrives takes a minimum wage job with a gang master, claims child benefit for his family in some remote part of Europe and gets subsidised housing at the expense of the local authority. Then they send a good deal of their money home to their family.

            I don’t blame immigrants for behaving this way – but it’s difficult to identify the net benefit to the UK economy by comparison to an economically independent retiree over paying for a property in France and settling and spending his pension income there.

  12. Tad Davison
    Posted June 26, 2013 at 9:54 pm | Permalink

    That’s an awfully big ‘if’ John. At the time of writing, Michael Gove is on Newsnight telling us how things could have been better but for the catastrophe in the Eurozone.

    That on-going mess could still cause the British economy massive penalties over which we have little or no control, but little emphasis has been given to it, with few projections as to the likely scenario. The word I would use, is ‘precarious’, and if it all goes pear-shaped over there, it’ll go pear-shaped over here too, and all of this will count for naught.

    Tad

    • Jerry
      Posted June 27, 2013 at 6:28 pm | Permalink

      @Tad Davison: “That on-going mess could still cause the British economy massive penalties over which we have little or no control, but little emphasis has been given to it, with few projections as to the likely scenario. [..//..]”

      That is so true of just about any major currency or stock market, after all the UK’s 1920/30s depression started on Wall Street, the recession of the early 1970s started with the Oil Shock (caused by war in the Middle East) whilst a change in Chinese policy for example could send the world into an economic vortex just as the EZ could. I’m not trying to down-play the EZ crisis, but nor am I attempting to up-pay it either – unlike some on John’s blogs do.

  13. Rob
    Posted June 26, 2013 at 10:34 pm | Permalink

    Shame on the government for protecting the massive international aid budget when ordinary British families are struggling. This budget equals the total amount of cuts announced today. I know the Conservatives won’t be in power in 2015 anyway but they could have at least tried to win back some support today.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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