Spending priorities

The government is conducting a spending review, to come up with 3 year spending plans from 2019-2020 until 2021-2. They have already announced substantial increases for the NHS budget and are currently consulting on what other changes should be made.

It is important that priority areas like the NHS, schools and social care receive increases to meet demand and costs. It is also important that action is taken to offset some of these increases through spending changes elsewhere, to avoid tax rate rises and to keep borrowing to low levels.

Leaving the EU without signing the Withdrawal Agreement would be a good start to the spending review, giving the government the best part of £39bn over two years to allocate to other priorities. Cancelling HS2 would also free considerable sums of capital, allowing spending on increasing rail capacity substantially to the Midlands and the North by investing in smart signalling and leaving money over for other purposes. If the government does not wish to revisit HS2, it could at least examine how to improve the efficiency and effectiveness of Network Rail spending and borrowing which remain at high levels.

The government should also review its spending on Overseas Aid. More of the budget should be allocated to the first year costs of migrants coming to the UK, as the rules allow. More should be used to construct the ships we need to provide humanitarian aid and support in disaster torn areas. This would relieve those budgets. This Parliament would not want to repeal the 0.7% Aid target so it is important to look at how it is spent.

Where budgets are being increased the government needs to ensure that the extra money is being routed into improving the volume and quality of service being provided. The departments need to bid for the extra money with costed plans for improvement. In the case of social care the money needs to go into more provision for social care support for individuals in their own homes, and into providing more good quality care home places. In the NHS there needs to be an expansion of capacity for the GP service and for the hospital service, to cut waiting times and to make the NHS more accessible to users.

What would your priorities be, both for more spending, and for reductions?

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102 Comments

  1. Steve
    Posted September 8, 2018 at 5:39 am | Permalink

    Mr Redwood

    “The government is conducting a spending review, to come up with 3 year spending plans from 2019-2020 until 2021-2. They have already announced substantial increases for the NHS budget….”

    Most interesting, especially the timing. Perhaps someone has finally managed to get Theresa May on the right track at last. For example; just leave the EU without the withdrawal agreement, save the billions for the NHS. Thus become electable again.

    Besides can you imagine the uproar when the public perceive future NHS problems exist because the money was given away to the likes of Barnier et al.

    Maybe the message has finally sunk in, we live in hope.

    • Peter
      Posted September 8, 2018 at 1:20 pm | Permalink

      “Leaving the EU without signing the Withdrawal Agreement would be a good start to the spending review, giving the government the best part of £39bn over two years to allocate to other priorities. ”

      That is the most important saving we could start with.

      The worry is this will not be allowed to happen. I had hoped Leave throw a spanner in the works and we run the clock down until we leave on WTO terms by default with no £39bn handover.

      Speculation in the media is that this is unlikely and No Brexit is suggested as the outcome if this is attempted. I am not sure if this is just more Project Fear or if there are sound plans to thwart WTO.

      The arithmetic is more important than the various arguments at this stage.

    • Richard
      Posted September 8, 2018 at 10:19 pm | Permalink

      Liz Truss made a good speech, promising to undertake a zero-base review of spending, better efficiency & less waste, reducing the big state etc. All good stuff…
      https://www.conservativehome.com/parliament/2018/06/the-self-styled-disruptor-in-chief-speaks-out-truss-says-higher-taxes-would-be-a-complete-contradiction-of-the-brexit-vote-her-speech-full-text.html#IDComment1063361851

      Conservative MPs should hold her to her fine words.

      Reply I have sent her the list of spending reductions I have set out here and elsewhere and lets see if she does any of them. She must start with a veto on the ruinously expensive EU Withdrawal Agreement

      • Richard
        Posted September 9, 2018 at 6:58 pm | Permalink

        Thank you. I totally agree. Lets see what she does.

  2. Ian wragg
    Posted September 8, 2018 at 5:44 am | Permalink

    Cancel HS2, cut aid to disaster relief only, cull the charitable quangos and severely restrict access to motorbility cars.
    Cut NHS management by at least 10% and stop all but the most essential cosmetic surgery.
    Cut MOD staff by half and increase defence spending especially navy.
    Sto all payments to Brussels.

    • Anonymous
      Posted September 8, 2018 at 11:18 am | Permalink

      Those of foreign nationality using the NHS but not paying the bills. Deduct from their country’s aid budget.

      At a time of NHS rationing we cannot allow it to be abused like this.

      • Anonymous
        Posted September 8, 2018 at 11:20 am | Permalink

        More navy ships will = more interception vessels for the nod-and-a-wink people ferrying racket.

        If our politicians were honest they’d have set up a free ferry line long ago. That’s what we have already in effect.

      • bigneil
        Posted September 8, 2018 at 4:48 pm | Permalink

        Anon – charging foreign nationals for their NHS treatment still leaves a problem. As some/most will not be able to speak/understand English we have to use translators – you would say we charge their country. Totally agreed, but there is still a problem after that – TIME for the treatment of our own people. Foreign nationals using our NHS with translators will take up many more times than normal, so it is not just a “treat one of theirs instead of treat one of ours”. It could be a ratio of 3 to 1 or 4 to 1 – in THEIR favour. And with no limits on treating theirs, we could easily end up treating ALL theirs, with none of ours getting any treatment. What is to stop foreign countries deliberately shipping their sick here for treatment on the NHS – that way they have absolutely NO need to have doctors or hospitals of their own.

    • Adam
      Posted September 8, 2018 at 4:16 pm | Permalink

      HS2 is needlessly wasteful.
      Dumping it would be sensible.

    • Posted September 8, 2018 at 8:09 pm | Permalink

      Ian – you are speaking for many of us. If ONLY common sense would prevail.

    • Richard
      Posted September 8, 2018 at 11:31 pm | Permalink

      The UK’s maximist 0.7% foreign aid is far more than other OECD countries. If like Canada, Australia & NZ the UK contributed the OECD median of 0.27%, that would save £8.6Bn (=£14-5.4Bn). And still be higher than USA, Japan, S Korea & Italy. https://en.wikipedia.org/wiki/List_of_development_aid_country_donors

      Like Germany, the UK should include all in-country refugee costs as ODA. Plenty more ideas here: http://www.dailymail.co.uk/news/foreignaid/index.html

    • Richard
      Posted September 8, 2018 at 11:52 pm | Permalink
  3. Lifelogic
    Posted September 8, 2018 at 6:26 am | Permalink

    Well the best thing one could do for the NHS is to make those who can pay something do so. The. Break it up and make it perform for customers. It is killing thousands every year.

    Tax relief for those who go privately or take private medical insurance (but perhaps have the insurance pay if they do still use the NHS). Similarly for private schools give vouchers for people to top up, give them freedom and choice). The average £1 paid in tax produces at best about 30p of value for the public after all the costs of collection, waste and misdirected expenditure is considered. Much of government expenditure does positive harm with no value at all. Cut the payments that deter feckless people from working or even learning how to work.

    HS2 and Hinckley are clearly pissing money down the drain as indeed is about 50% of government activity. Cut train subsidies and let them compete on a level playing field with other modes of transport, cut all the green crap subsidies likewise. Employ some competent and honest people to handle defence procurement. Simplify the tax system the complexity alone cost billions. Cut red tape a tax cut with no loss of revenue indeed an increase in revenue as business become more competitive.

    Stop the loans for all the duff degrees about 2/3 of them. Anything you can get to with less than three B’s at A level and Oxford PPE for obvious reasons (it attracts some highly dubious people). Let people pay for their own hobbies.

    Cut out the largely bogus charities about 2/3 of them deserve no tax breaks. They cut the overall rates. Corporation tax should be zero tax only when you tax the money out bet the business invests it than government wastes it.

    • Lifelogic
      Posted September 8, 2018 at 6:29 am | Permalink

      Hopefully we will pay nothing to the EU after May and Hammond are evicted as nothing is due, but if we do it should certainly come out of overseas aid.

    • Ed Smith
      Posted September 9, 2018 at 6:07 am | Permalink

      I read today that the Chinese govt. is cancelling trade talks with us in reprisal for our sending a warship through international waters the Chinese demand be recognised as theirs near the Paracels. [This is not a backwater, it is on the direct route from the Singapore Straits to Japan]. This is a gift to us, we can cancel the Hinckley Point nuclear project forthwith. We ought to have anyway, several reports in recent years show the design to be a poor choice with none of its previous projects able to demonstrate that it works.

  4. DUNCAN
    Posted September 8, 2018 at 6:29 am | Permalink

    The tiresome myth of the underfunded, overworked creaking NHS is becoming tiresome, tedious, grasping and political.

    The fundamental problem is that the NHS is unreformed not underfunded. It is an organisation run primarily for its own benefit. All else is secondary

    The ‘underfunded, overworked’ myth is now rolled out as part of a budget expanding strategy that’s been in play for years.

    So while retired NHS staff are playing gold at 55 years of age my relatives will still be working at 67. Is that fair? Is it???????????? It is an abuse of the private sector and those who work in it.

    Politicians of all parties know they can hammer the private sector without any political comeback while reform of the public sector is conveniently put on the back-burner ad infinitum. It reflects the unprincipled nature of modern politics.

    The Tories are mean’t to extract value for money provided by the taxpayer not pander to the public sector vested interest

    What is the point of voting for this duopolistic political con that’s emerged? Labour is Marxist and the Tories have filled the gap left by New Labour.

    Jesus wept

    • DUNCAN
      Posted September 8, 2018 at 6:30 am | Permalink

      ‘playing golf’

      • Den
        Posted September 9, 2018 at 3:31 pm | Permalink

        Or did you really mean “Playing (with their) gold (plated pension money)”?

    • Lifelogic
      Posted September 9, 2018 at 6:16 am | Permalink

      Indeed the NHS is a sick joke and can never work as currently structured but no ones dares to do anything about it.

      The average state sector pension pot is apparently over six times the average private sector one. The ones Brown, Osborne & Hammond have mugged even further.

      So in the private sector you have to pay higher and higher taxes just to fund people with pensions six times larger than your own will be.

  5. Student
    Posted September 8, 2018 at 6:55 am | Permalink

    Spending:

    – More money to top Univerisities researching cutting edge science, technology and medicine. This will naturally filter into new spin out companies and allow us to compete with the next Google, Apple etc.

    [Combine this with better tax, ability to employ top talent not just from EU (as we are currently required by Brussels to discriminate for) but also from eg Africa, Asia etc, and reduction of red tape to make us fully competitive for start ups & tech companies to grow here in the UK. Also stop booting out graduates after they finish uni who have attained top 4 year degrees in eg software engineering from our top unis, and let them get work visas (again, probably easier to do after March 2019).]

    – Redo of Uni systems whereby courses wanting any government funding/government-backed loans must competitively apply to the government, giving evidence of course value, uni & teaching level/prestige, industrial connections, international quality & recognition etc

    Reductions:

    – Streamlining NHS to become more efficient & reduce costs eg the needless bureaucratic costs associated with patient deaths listed on this blog

    – Reduce/abolish tarrifs on food, cloth & footwear (biggest expense to average British citizen) after March 2019. This needlessly costs the car consumer.

    • Student
      Posted September 8, 2018 at 6:56 am | Permalink

      The consumer*

  6. agricola
    Posted September 8, 2018 at 7:37 am | Permalink

    I take exception to building ships to provide humanitarian aid for African economic migrants intent on getting into Europe. There is a gaping need for fishery protection vessels to police our waters after Brexit. That is where you need to be spending money on ships.

    The distribution of aid money is a monument to profligacy. Overseen by a civil service fine tuned to spending other peoples money.

    • agricola
      Posted September 8, 2018 at 2:41 pm | Permalink

      At a well thought out cut off date in the not too distant future I would call a halt to public sector pensions. From that point onwards all civil servants whether in national government or local government would mandatorily fund their own pensions at a minimum level with the option of making higher contributions should they wish. This would of course include members of Parliament. I can see no logical reason why their pension arrangements should be any different from the self employed. Particularly as the self employed are creators of wealth whereas the government are a burden on wealth creation.

    • Sobstory
      Posted September 8, 2018 at 3:13 pm | Permalink

      agricola…First of all African economic migrants should be pulled from the sea as per safety of life at sea regulations but after medical attention should be landed back in Africa again..straight away..we have heard enough from these bleeding hearts who want to land them in Europe..and to what end? Have of these greenpeace types thought about what these migrants might be working at in say three years time or where they might be living if they are allowed in..mostly young males all living together in high rise..talk about storing up trouble for the future?

      Secondly it is not naval ships that we need now so much but a huge investment to build merchant ships considering our soon to be disengagement from EU trade and new trading deals starting up with countries far away. We are going to need more container ships and bulk carriers under the British flag- roro and lolo ships like we have at present plenty of will not be suitable when Dover Calais trade winds down.. We cannot rely anymore on european owned shipping companies to supply our needs particularly in time of political upheavel and world conflict..as we know only too well from the past..the fisheries can be policed by navy patrol boats..unless a start is made at this then I cannot take seriously any of what Liam Fox Rees Mogg Boris and others say about new trading partners

    • Fedupsoutherner
      Posted September 8, 2018 at 8:53 pm | Permalink

      @agricola. Agree totally with your comments

  7. Eh?
    Posted September 8, 2018 at 7:42 am | Permalink

    Governor Carney BOE has spelled it out.Recently.
    We do not have any money to spare. It could be soon we will be further in debt and continuing decline.
    Spending money at all even as “priorities” Do a whip round. Cutting the whip end into five long segments makes it smart even more.
    Economise like our Mums and Dads have had to. Don’t spend. Just keep it as it is if you can.

    Or get a new Chancellor, BoE Governor. The sun may be hidden behind a cloud.

  8. British Spy
    Posted September 8, 2018 at 7:49 am | Permalink

    Queen Elizabeth , btw, our new aircraft carrier, I may have missed the news. Where is it?????
    I thought it had set off to America???.

    • Ian wragg
      Posted September 8, 2018 at 12:14 pm | Permalink

      Tied up at Key West Florida. Excellent run ashore.

      • British Spy
        Posted September 8, 2018 at 2:50 pm | Permalink

        Very good! Thanks Ian!

        • British Spy
          Posted September 9, 2018 at 5:44 pm | Permalink

          Something seems to have happened with one or two crew members 🙁

  9. Lifelogic
    Posted September 8, 2018 at 7:52 am | Permalink

    We need a level playing field and fair competition between the appallingly incompetent state monopoly NHS which is killing thousands and private provision. Currently if you go privately to pay four times. One for others in taxes and NI, then in tax and NI on the money needed to pay for your treatment or insurance and then a further (now 12% thanks to the economic idiot P Hammond) in insurance tax.

    We also need to pay good doctors rather more but get their productivity up. Many leave the profession or go abroad after their very expensive training. Only about 50% who qualify actually join the NHS. New doctors train for 5 or 6 years minimum then earn rather less than 40K even in London and have student debts of perhaps £200K. This while ambulance chasing and other lawyers earn far more after just three years and produce nothing of real value. Which profession is the more important?

    A typical example of incompetence, there are several every day in the NHS. Most are covered up.

    http://www.dailymail.co.uk/news/article-6139277/Coroner-finds-child-hospitals-neglect-led-death-toddler.html

    • Lifelogic
      Posted September 8, 2018 at 12:32 pm | Permalink

      PM ‘retains confidence’ in Northern Ireland secretary Karen Bradley apparently. This after she freely admits she did not even know the very basics about Northern Ireland.

      Why on earth appoint such a person to the job one wonders, was there an interview process? She read maths at Imperial so something elsewhere would surely be more suitable. The commons is not exactly full of numerate and rational people.

      Then again we have a chancellor who understands nothing about a sensible fiscal policy and economics, an energy secretary who know nothing about energy engineering, green crap or economics, a defence secretary who has a a BSc in Social Sciences from the University of Bradford ……… and a PM who has a geography degree and can only just about robotically read out statements put in front of her. Never has she shown any ability to think for herself either on her feet or in long term planning.

  10. Adam
    Posted September 8, 2018 at 8:12 am | Permalink

    Maintain expenditure at sensible levels but reduce its cost to Govt by:

    – offering an Education subsidy to qualifying parents who choose to pay for private school education.

    – sharing the NHS budget equally among the population & repaying 20% of their account savings at age 45 to those whose budgets are in credit.

    – creating a massively upgraded Crimestoppers-type scheme with high rewards.

    – changing motorway lanes to a space-efficient sequence where barriers are not needed.

    – increasing Carer’s Allowance to enable families to reduce the burden on the state.

    • bigneil
      Posted September 8, 2018 at 4:53 pm | Permalink

      Adam, your point on the barrier-less motorway lanes. Try driving on the Aston Expressway at Birmingham on a dark, windy and wet night. You might change your mind as fast as you’ll need to change your underwear.

      • Adam
        Posted September 8, 2018 at 9:01 pm | Permalink

        bigneil:

        The more efficient motorway would prevent skid marks.

        Better use of space creates 2 extra 30mph lanes, with an emergency lane between them. The fastest-opposite traffic would be 7 lanes apart.

  11. Oliver
    Posted September 8, 2018 at 8:36 am | Permalink

    Dilnot.

    Abolish long term capital gains tax.

    Both free up capital for more productive investment.

    But introduce taxation on property windfall gains, that misdirect capital to unproductive delusional wealth “creation”.

  12. ChrisS
    Posted September 8, 2018 at 9:01 am | Permalink

    The £14bn foreign aid budget is universally unpopular amongst voters yet the spend is increasing each year and, despite Penny Mordaunt and her predecessors’ best efforts, much is wasted because the amount is too vast for the department to be able to properly supervise and ensure it is spend wisely.

    We seem to have no chance of reducing it to a more reasonable level so reform is therefore the only answer.

    Firstly it is our (100% borrowed) money and we should be the sole arbiter of how is is spent. I would therefore move away from the UN definition of what is “Aid” and develop our own. No money should be handed to large charities, UN or EU agencies to be spent as they see fit.

    Secondly, the principle should be that all aid spending should be on goods and services purchased from UK businesses. The only exception to this should be immediate emergency relief where there is absolutely no alternative.

    Thirdly, no Aid whatsoever should be provided to any country in possession of nuclear weapons or a space programme, nor to any country run by despots. ( Our definition )

    Fourthly, the Aid budget could pay for a new humanitarian service structured along quasi military lines and consisting of part time Doctors, Nurses, Firefighters and other (possibly retired) military personnel. There would also be a substantial number of young, paid volunteers who would be trained and then serve a minimum of two years around the world.

    Finally, a fleet of transport aircraft and emergency support ships that can also double as RAF and Royal Navy support should be built and operated out of the aid budget. They should be manned by an expansion of the British Merchant Marine with some Naval officers.
    The MOD would contribute to the cost whenever they are used by the RAF or Navy on a day rate basis. The cost of this equipment would be less than the amount currently wasted each year through lack of proper supervision of the vastly over-bloated aid budget.

    The ships can visit ports around the world when not in use for Aid or Naval tasks, projecting soft power and showing the wider world our global reach and commitment to supporting Countries in times of need. Obviously their routing would be designed to place them in regions where emergencies are likely to occur, such as the Caribbean in the Hurricane season.

    Remodelling our aid programme along these lines would go a long way to making the expenditure more acceptable to voters

  13. Lester Beedell
    Posted September 8, 2018 at 9:20 am | Permalink

    Not spending £13 billions on foreign aid would be a good start!

    • Lifelogic
      Posted September 8, 2018 at 12:34 pm | Permalink

      Any payment to the EU should count as part of foreign aid. Not that we should be paying anything at all to the EU on leaving quite the reverse they should buy out our share of the assets.

      • Gary C
        Posted September 8, 2018 at 7:20 pm | Permalink

        Re: ‘they should buy out our share of the assets.’

        There are plenty who agree with that however TM & Co appear to be convinced it’s in the country’s interest to sell our soul so are ignoring the will of the electorate.

  14. Caterpillar
    Posted September 8, 2018 at 9:31 am | Permalink

    Unsure whether it is spending or policy but a crackdown on minor crimes with an associated increase of punishment is needed, with children treated the same as adults. Littering, shop lifting, fly tipping, carrying, etc. all need to be stopped as gateways. Normalisation of considerate behaviour must be put into schools. Anyone committing any violent crime (whether fist, foot, knife, acid, gun) unless self defence / protecting own property needs to be removed from possible interaction with others, the risk should not be born by the innocent. Sadly a period of ultratoughness for behaviours incompatible with a high density society is needed.

    • Anonymous
      Posted September 8, 2018 at 11:23 am | Permalink

      Littering in particular – it creates an abandoned environment that nice people don’t wish to visit so it gets ceded to criminals.

    • Anonymous
      Posted September 8, 2018 at 11:47 am | Permalink

      I disagree with you on one point. There is a lack of manners in modern society. Times were better when you could smack your own rude kid (or even another’s.)

      As for blokes, a swift punch on the nose was all it took to sort out a bit of rude behaviour and no-one would have thought any worse of it. Nowadays someone pushing in front without apology, deliberately blocking your way, abusing you verbally or insulting your missus would go squealing to the police as soon as you did that.

      • Steve
        Posted September 8, 2018 at 8:06 pm | Permalink

        @ anonymous

        Well said.

        “Nowadays someone pushing in front without apology, deliberately blocking your way, abusing you verbally or insulting your missus would go squealing to the police as soon as you did that.”

        But you’re not allowed to do it back. Didn’t you know ?

        It’s reckoned you can tell the moral wealth of a nation by how it treats it’s animals. Though I have yet to be informed of anyone cruel to animals having the same done to them as punishment.

        Also we’re controlled by law as to what we are allowed to say, whom we are allowed to dislike, even what we are allowed to think.

        In a right mess aren’t we.

        Left wing socialism at it’s finest.

  15. Rien Huizer
    Posted September 8, 2018 at 9:38 am | Permalink

    Apart from the fallacy that exit without a withdrawal agreement (or rather the one that is part of the intentions informally agreed upon last year) will save 39bn, there is quite a lot that can be saved in the UK government accounts (the NHS, an overambitious military equipment budget and overall efficiency of central government spending on, eg education) but also a lot of spending that should take place in order to preserve a decent, liberal society as befits the country that contributed much to the Enlightenment. UK gvt spending is close to the weighted OECD average (if one includes all public spending, including state and local in the US) but revenue received is below par, despite the presence of several inefficient taxes (stamp duties etc). UK should privatise the NHS (sell the buildings and build modern hospital facilities in industrial estates for instance; privatise the GP business, etc. Change the admision of consultants (there is a growing body of registrars without full consultant prospects) and make all consultants self-employed. In a system where the user pays (backed by compulsory insurance ) with a deductible for most services, maybe waiting lists will melt away and the injustice of a spartan NHS side by side with luxurious private practice that cherry-picks the public sector, disappear.

    • Anonymous
      Posted September 8, 2018 at 11:50 am | Permalink

      Indeed. There are consultants doing private work using NHS underlings on NHS pay.

      • Lifelogic
        Posted September 8, 2018 at 12:37 pm | Permalink

        I am sure there is in some cases. So appallingly structured & managed is the NHS. Endless operations cancelled at the last minute wasting huge resources every single day.

    • Ian wragg
      Posted September 8, 2018 at 4:08 pm | Permalink

      There is absolutely no need for a Withdrawal Agreement
      This is another ruse worked out by Remainer May to extend membership and a cover for payments to Brussels.
      I note that the transition period/Do nothing 21months Implementation period is not much spoke of these days and no formal agreement was made last year. Remembered Barny……
      Nothing is agreed until everything is agreed….

    • NickC
      Posted September 8, 2018 at 4:36 pm | Permalink

      Rien, You know as well as I do that the upfront £39bn is a bribe. We will continue to pay as members and as sub-members. We could not possibly owe more than we would have paid if we had continued to the end of the MFF. That is about £18bn net. We do not owe the EU “reste a liquider” amounts. You will have to adjust your budgets for the fact that we will have left. If you don’t, that’s your look out.

      • Rien Huizer
        Posted September 9, 2018 at 9:35 am | Permalink

        No, I do not, if I did I would not be commenting. I have no axe to grind, my only objective here is to offer well informed views from a mainstream economics perspective. I do not believe that I will benefit or suffer personally from whatever outcome the UK process will produce and I wish the UK people well. I also do not believe that a large country like the UK (or, a small country but large relative to the EU avarage, should have this exceptionalist approach. If you do not like the club, leave, but if you want to be a member, accept to be treated like everyone else. So I am perfectly happy about the UK’s departure but still perplexed about the debate within UK politics. It would be good for the UK to have as many benefits as possible, but the EU can only offer whatever it is institutionally capable to do. That is why I read these posts and comments and feel free to join the debate..

        You are right that, if the UK would not honor any claims the EU has, the EU would have to cut or raise replacing funds. I would be in favour of cutting because the current EU budget contains – here the term “bribe” is appropriate- bribes for people and politics that do not deserve support, like the current Polish government and some of the other Visegrads. I would not mind these countries leaving of course. And of course inefficient farm support should disappear. Tariffs are better than subsidies, because they allow more efficient reallocation of resources. There are too many backward regions that should be incentivized to promote outward mobility and not be subsidized to keep people in some agrarian open air museum. Countries like The Netherlands need these people for economic growth in a much more productive environment.

        As to the justification of that “39 bn”I recommend looking at the data used by the negotiators. Anyway that figure is a snapshot result of a complex set of calculations and some payments (and UK receipts will occur only in the distant future). Also, the amount could change, for instance as a result of excvhange rate movements. A strong Pound, resulting from a very soft Brexit, would make it less. A failure to achieve agreement before, say, December, likely to cause further downward pressure on the GBP/EUR would make it go up, quite a problem if at the eleventh hour the UK would come to its senses.

        But you do not believe that ,so enjoy while you can.

  16. Alison
    Posted September 8, 2018 at 9:51 am | Permalink

    My priorities for spending: 1) education & vocational training, from primary through to colleges, university, underpinned by our country’s strategic needs. Make it admirable to be an apprentice then craftsman. Train lots of doctors. The benefits will be felt in just a small number of years.
    2) Invest properly in core fibre broadband infrastructure, to cover the whole of the UK (including rural areas), to support a highly competitive economy and healthy society. The current system is not appropriate, with for-profit entities unwilling to put in even decent fibre in rural areas because it hits their margins. The interests of the provider and the stakeholder are not aligned; while I am all in favour of for-profit, the current situation is damaging to our country’s economy and society. The fibre broadband needs to be provided to be fast, and faster and with stronger bandwidth than in other countries. We need it for new models of health and education provision (education through to third age).

    For info, I know that suburbs of big German cities have poor broadband … Let’s get ahead!

  17. Alison
    Posted September 8, 2018 at 9:53 am | Permalink

    Hammond has fed the Scottish press, saying that there will be spending cuts if there is no deal. I think his comments were mostly in relation to the period immediately after 29 March 2019, but they are perfect for the ravening Remainers in Scotland.

  18. dumbcluck
    Posted September 8, 2018 at 9:53 am | Permalink

    Correction “I AM reading”

  19. English Pensioner
    Posted September 8, 2018 at 10:30 am | Permalink

    Part of the Foreign Aid budget should be allocated to the NHS for the treatment of ‘visitors’ who come to this country deliberately to get treatment on the NHS. The recent case of a Nigerian woman who cost the NHS something like £100K for a complicated childbirth comes to mind.
    If our Services give assistance in time of need, such as hurricanes or earthquakes, their costs should also be reimbursed from the foreign aid budget.
    All foreign aid given to countries should never be as cash but as British made goods which are needed in the country concerned, taking care none are luxury goods for the benefit of those in power. Such an approach would help UK businesses whilst helping those in need.
    Finally, the 0.7% should not be treated as a ‘target’, but as a maximum. Civil Servants should not be wasting money on unnecessary things just to meet a target.

    • Brian Tomkinson
      Posted September 8, 2018 at 11:14 am | Permalink

      You wrote : “Finally, the 0.7% should not be treated as a ‘target’, but as a maximum.”

      Our politicians, foolishly, have enshrined that figure in law (the only form of government expenditure to be so protected) that is why they waste it with abandon.
      Tells you much about where their priorities lie.

      • cornishstu
        Posted September 8, 2018 at 6:35 pm | Permalink

        But what government can protect it can unprotect, the government of today cannot bind future governments. The, ‘but its ring fenced’ is con to shut up the plebs.

  20. formula57
    Posted September 8, 2018 at 10:50 am | Permalink

    “The criminal justice system is close to breaking point”, so reported the Public Accounts Committee two years ago and it seems extra funding would go some long way to rectifying what are troubling deficiencies that have worsened meanwhile.

  21. Richard1
    Posted September 8, 2018 at 10:53 am | Permalink

    Nine of these proposed savings – £39bn leaving present to the EU, HS2, overseas aid etc can happen with Mrs May as PM. I see Paris is taking over from London as preferred base for super rich. No wonder. Macron has cut all capital taxes to 30% and more or less got rid of wealth tax. Meanwhile we have absurdities like 15% stamp duty and 47% marginal income tax rates (inc from investments unlike France). We need to get real. Post Brexit needs to be ultra competitive to have any chance of being a success. Needs a change of PM. Can Boris really be chosen now?

    • Richard1
      Posted September 8, 2018 at 10:53 am | Permalink

      None

    • libertarian
      Posted September 8, 2018 at 2:53 pm | Permalink

      Richard1

      Agree .

      Boris is the only one that the general public would vote for. As has been seen with Trump. Working lass voters dont care about the political correctness and virtue signalling of candidates. They want someone who will deliver what they voted for. Thats it

      If the CCHQ can be stopped from rigging the election again and Boris gets the gig, implements Brexit and calls an election to ratify it he will win in a landslide

      • Chris
        Posted September 8, 2018 at 11:16 pm | Permalink

        Well said, libertarian. The signs are all there on how to win a huge election victory, but our PC, cultural Marxist leaning, liberal left (“Conservative”) elite seem determined to ignore them.

        I am delighted that Davis is going to be on a platform with Farage and Hoey in the first of many Leave.eu rallies in the country. Peter Bone is speaking out tonight also referring back to his campaigning with Grassroots out, where he too was on a platform with politicians across the spectrum. One of the most electrifying rallies was one where Farage, Bone, and Liam Fox were key contributors.

  22. Iain Gill
    Posted September 8, 2018 at 11:00 am | Permalink

    Please don’t give more money to the NHS without giving significantly more power and decision making to patients.

    I have had several really bad experiences with the NHS in the last few months I really dispair at what the people have to tolerate.

    Lazy politicians refusing to say that the emporer has no clothes or that it can be solved with more tech spend are really starting to look ridiculous.

  23. Anonymous
    Posted September 8, 2018 at 11:16 am | Permalink

    Difficult with the BBC setting a lot of the agenda.

    • Lifelogic
      Posted September 8, 2018 at 12:43 pm | Permalink

      Indeed and the BBC is wrong on almost everything yet so many people still trust and repeat their silly “Polly Toynbee” type views. Climate alarmism, lefty magic money tree economics, housing, PC drivel, massively anti-trump, pro high taxes, pre the anti-democratic EU and the big nanny state and pro the appalling “envy of no one” NHS.

      • hefner
        Posted September 8, 2018 at 5:47 pm | Permalink

        2018 “climate alarmism”:
        USA, more than 4400 bush/forest fires since beginning of the year;
        Greenland: a 6-km wide iceberg detaches from the ice sheet in less than 30 minutes;
        Sweden: devastated by forest fires, a new “feature”?
        Australia: worst drought in 50 years;
        Portugal/Spain: temperature records are smashed, 43C in Lisboa, 44C in Córdoba;
        SW Japan is swept by Jebi a typhoon with 220 km/h winds.
        Fortunately nothing has happened in dear old Britain, except that finally Lord Lawson will only be asked by the BBC about what he knows (economics) not about what he has read in Beano.

        • Fedupsoutherner
          Posted September 8, 2018 at 9:04 pm | Permalink

          Hefner. Is that the first time all this has happened and what about before records began?

        • libertarian
          Posted September 8, 2018 at 9:25 pm | Permalink

          hefner

          Yeh because nothing like that ever happened before the invention of the combustion engine did it? Oh wait ? *sigh*

          Sweden’s * new* Forset fires, Lol A Chap called Wetland wrote a paper on the history of Swedish wildfires in 1934 !!!

          • Puffer Fish
            Posted September 11, 2018 at 8:03 pm | Permalink

            Please provide proper references, or is it a 1934 document only accessible in the British Library, which has never been repertoried and accessible only to some happy few people? Or have you ever heard of it on your favourite Brexiter site?

        • Edward2
          Posted September 9, 2018 at 12:22 am | Permalink

          There are no more extreme weather events now than there were centuries ago.
          The 24/ 7 media channels now show every event.
          Average global temperatures are just over one degree more than they were 150 years ago.
          We were told by Al Gore that atfer 2000 temerature rises would increase.
          In fact the opposite has happened there has been a slow down in the rate of increase.

          • Puffer Fish
            Posted September 11, 2018 at 8:11 pm | Permalink

            Have you any idea what an addition of one degree over the total atmosphere translates into Available Potential Energy directly feeding Available Kinetic Energy? (Why not look for Edward Lorenz, and his representation of energy sources, reservoirs, sinks, and conversion factors; you might learn something).

        • libertarian
          Posted September 9, 2018 at 3:56 pm | Permalink

          hefner

          Facts old boy, facts

          Wildland fires

          90 percent of wildland fires in the United States are caused by people, according to the U.S. Department of Interior. Some human-caused fires result from campfires left unattended, the burning of debris, negligently discarded cigarettes and intentional acts of arson. The remaining 10 percent are started by lightning or lava. NOTHING to do with hotter weather

          Artic cruise ship exploring the melting ice gets stuck in er…… ice

          Canadian Coastguard issue this warning in August 2018

          Good morning, Due to heavier than normal ice concentrations in the Canadian arctic waters north of 70 degrees, the Canadian Coast Guard, recommends that pleasure craft do not navigate in the Beaufort Sea, Barrow, Peel Sound, Franklin Strait and Prince Regent. CCG icebreakers cannot safely escort pleasure craft. Operators of pleasure craft considering a northwest passage should also consider the risk of having to winter in a safe haven in the Arctic, or in the case of an emergency, be evacuated from beset vessels. Safety of mariners is our primary concern

          Maybe the Beano has a better insight than you then heffie

      • getahead
        Posted September 8, 2018 at 6:01 pm | Permalink

        And that is an area where money could be saved. Not for the government but for the poor bloody infantry who are compelled to pay the BBC tax.

  24. hans christian ivers
    Posted September 8, 2018 at 11:22 am | Permalink

    JR.

    This is a very important and valuable contribution to the future spending review and touches on a lot of the issues I have asked us to discuss as well.
    The question is, whether the hypothesis is based on a false premise. If, we leave without a deal we will be much worth off according to the Treasury to the tune of £ 80 billion in lost revenue for the Treasury. So the question is, will we really have that much more money to spend or might we actually end up having less to spend?

    • Edward2
      Posted September 8, 2018 at 2:38 pm | Permalink

      Is that the 15 year guess that we will be worse off.
      Their previuos predictions over a much shorter timescale cab be seen to be wrong and overly negative yet you still believe these new figures.

      • hans christian ivers
        Posted September 8, 2018 at 8:06 pm | Permalink

        Edward”

        I asked a question, I did not give a conclusion , so read what I have written.

        • Edward2
          Posted September 9, 2018 at 9:34 am | Permalink

          Your previous posts lead me to conclude you believe the 15 year treasury forecast hans.
          Im just pointing out to you that their previous forecasts over a much shorter timescale didnt come true.
          I read your post.

        • NickC
          Posted September 9, 2018 at 10:48 am | Permalink

          Hans, You made a conditional statement: “If we leave without a deal we will be much worse off according to the Treasury …”. So read what you have written again. That is what Edward2 was commenting on.

    • libertarian
      Posted September 8, 2018 at 2:46 pm | Permalink

      hans

      You raise a reasonable question. It just depends on whether you believe the Treasury forecasts or not. My opinion is that seeing as a) Every other Treasury forecast has not only been wrong but wildly wrong b) There is no hard evidence in the Reassure forecast to back up their assertions I would go for the lets ignore the Treasury route myself

    • Dave Andrews
      Posted September 8, 2018 at 3:37 pm | Permalink

      The treasury has no idea how much we will be worse off. Whether we are better or worse off for leaving the EU no-one will ever know, as our exit will soon be overtaken by world events.
      What I do know for sure is spending £39bn on the EU will leave us £39bn worse off.

    • Ian wragg
      Posted September 8, 2018 at 4:11 pm | Permalink

      The Treasury has a prediction history about the same as my Father doing the Littlewood pools.
      Nothing after 60years of playing.
      They are the perpetrators of Project Fear.

    • NickC
      Posted September 8, 2018 at 4:51 pm | Permalink

      Hans, That depends on you believing the Treasury forecasts. That is inadvisable. Very similar forecasts were made in H1 2016 about the consequences of a Leave vote (“profound economic shock”; “recession”; “unemployment increase of c500,000”; immediate increase in BoE rate; etc.).

      The prime reason to opt for the Leave outcome was to regain independence from a corrupt organisation of politicians, for politicians and by politicians. The secondary reason is economic: we will do better running our own trade policy and economy.

      • Rien Huizer
        Posted September 9, 2018 at 7:53 am | Permalink

        Have you got better forecasts? If so, by whom?

        Reply, Yes, my forecasts re the ERM, and banking crash and post Brexit vote were much more accurate than the Treasury etc

        • Rien Huizer
          Posted September 9, 2018 at 9:40 am | Permalink

          Your own then. So you were short GBP, short RBS etc stock and had a bet on the most recent election. Beats the dogs, but occasions like these are rare and shorting is more for professionals.

          • libertarian
            Posted September 9, 2018 at 4:00 pm | Permalink

            Rien

            Whats your star sign ? I’ll do a forecast for you

        • NickC
          Posted September 9, 2018 at 10:52 am | Permalink

          Rien, Why do I have to have any forecasts, just because you choose to cite one? This isn’t a forecasts pissing contest, it is about the serious matter of UK independence.

          • Edward2
            Posted September 9, 2018 at 3:41 pm | Permalink

            Well said Nick.
            Lots of remain supporting research organisations currently churning out propaganda which the media lap up.
            Only when you dig into their data do you see how they get to their headline figures.

    • getahead
      Posted September 8, 2018 at 6:04 pm | Permalink

      The UK is the largest net loser from the Single Market. Trade in the Single Market costs the UK a deficit of just under £100bn per year The UK is the biggest net loser from trade in the Single Market, out of the 28 member states.
      Don’t believe the Treasury. It works for the internationals and Brussels.
      We will be better off out of the EU. By a long way.

  25. Geoff not Hoon
    Posted September 8, 2018 at 1:04 pm | Permalink

    Increase spending on real Police. Abolish P and C Commissioners, Deputy Commissioners and Chief Executives. Abolish HS2 now before spending gets out of control. Review overseas aid by giving the review to someone like yourself Mr. Redwood. How many more pounds are going to foreign dictators to fund lavish lifestyles and London homes before a real crackdown begins?

  26. sm
    Posted September 8, 2018 at 2:45 pm | Permalink

    Students studying STEM subjects should be encouraged by slashing or even removing loans for fees. Compensate by severely reducing the number of university places for all other subject, and reintroducing polytechnics.

    Abolish the requirement that all nurses must have University-type degrees.

    And (I’m being polite here) have a serious review of the benefits of green subsidies; it’s not only LifeLogic who questions who gets the most benefit, the public or the producer!

  27. libertarian
    Posted September 8, 2018 at 2:49 pm | Permalink

    Once again this laughable, atrocious, “Conservative Government” has attacked 3 million self employed people by reneging on the promise to change Class 2 NIC’s

    Momentum took over Labour , it appears they were late to the game. The SDP/Lib Dems took over the Tory party a couple of years ago when a large number of Torys left and join UKIP. The Conservative Party is dead

  28. ian
    Posted September 8, 2018 at 3:21 pm | Permalink

    All increases in the government departments spending will go on wages increases and pension increases for the workers very little will go to people who use the services in money terms.
    All government promises to the public workers over the years coming home to roost, a lot more cuts to come going forward for people services with a lot more people coming into the country looking for services.
    More money from taxes to service mainly wages and pensions for staff with little money going on the people who use the services as the populate increases.
    CATCH 22

  29. John Dodds
    Posted September 8, 2018 at 4:34 pm | Permalink

    The acquisition of drugs and medical supplies should be centralized and carried out by people who have the necessary knowledge and qualifications to ensure that there is no waste,if this not already being done.

  30. acorn
    Posted September 8, 2018 at 5:01 pm | Permalink

    Before I would answer this question, I would want to know what is the post Brexit spending plan of the “no deal” ERG 62 / Rees Mogglodytes. I would need to see the detail of your Chequers Alternative Brexit Plan. Can you tell us when it will be published JR?

    I suspect it does not exist. If it ever does exist, when will it be available for public scrutiny? Can you take the risk of it being ridiculed by such scrutiny? Should it be kept as a God like threat for the “leave” tribe, to keep them true to your Legatum-Minford commandments?

    • Tredo
      Posted September 8, 2018 at 7:02 pm | Permalink

      Certainly interesting that Redwood promised us the ERG’s plan.

      So where is it ? Where is it?

      Reply Coming soon

  31. Roy Grainger
    Posted September 8, 2018 at 5:14 pm | Permalink

    If the Conservatives think they can take on Labour with spending promises they are sadly deluded, Labour will always promise more. As an example of how the Conservatives simply ape Labour policies witness Hammond’s solution to the High Street being damaged by Amazon: it is to tax Amazon more rather than taxing the High Street less (via business rates).

  32. NickC
    Posted September 8, 2018 at 5:48 pm | Permalink

    My list of spending changes:
    1. No new Hinckley C type Nuclear plants (too far on to stop economically).
    2. Instead promote SMRs (Small Modular Reactors) – onus on private industry.
    3. Scrap HS2.
    4. Use HS2 money to fund undergrounds for big provincial cities.
    5. Scrap DfID, and all foreign direct routine aid.
    6. Use some saved DfID money on disaster aid via FCO and Armed forces.
    7. Out of the EU, trade with African nations decently – no EU-style exploitation.
    8. No £39bn bribe to the EU.
    9. Direct net saving by leaving EU of £10bn-£12bn annually.
    10. Indirect net saving from leaving the EU of up to £100bn annually.
    11. Ensure NHS collects bills from foreign governments or insurance.
    12. Program to repair our dilapidated roads.
    13. Scrap all supposedly “green” subsidies.
    14. Ensure all big foreign corporations pay their fair share of tax – no “deals”, no excuses.
    15. Cut business taxes to make us more competitive.
    16. Cut personal taxes.
    17. Cut back Quangos and eliminate regionalisation in England.
    18. Scrap the BBC TV Tax – make the BBC pay to view.
    19. No abortion/sex-change/cosmetic treatment on NHS (rape, suicide, etc, excepted).

    There are, of course, many more alterations and tweaks. One example is rectifying the absurdity that insufficient nurses are trained here, which results in the NHS hiring foreign nurses to make up the shortfall. The government should ask doctors why they are leaving – and then do something about it. Funding should be withdrawn from Universities that don’t promote free speech. And so on.

  33. Prigger
    Posted September 8, 2018 at 7:59 pm | Permalink

    @NickC
    “18. Scrap the BBC TV Tax – make the BBC pay to view.”
    In that the government can close the BBC down, it should do permanently.
    It is doubtful anyone else would employ some of the staff so they should be given appropriate redundancy payments and retraining in journalism courses lasting four years in America, Fox News is not so bad, perhaps the best

  34. Anonymous
    Posted September 8, 2018 at 8:16 pm | Permalink

    Wow. Last Night of the Proms.

    I didn’t know so many were loyal to the EU flag. This on top of our troops wearing it this week. Too much. Too much.

  35. JoolsB
    Posted September 8, 2018 at 8:17 pm | Permalink

    John as per usual you are spot on but unfortunately the clueless May Government do not agree with you, it’s only taxpayers’ money after all and socialist governments such as May’s love to waste it. You mention health, education and social care, but the UK Government is only responsible for these areas in England and yet you fail to say so and yet it is England and English services which this anti English UK Government’s austerity measures are hitting hardest even thought England is the only net contributor to the UK coffers. Could you please explain how Hammond could find an extra 4 billion (bribe) for the devolved nations in the last budget plus 1 billion (bribe) to the DUP when they already receive much more per head of English taxes than we do and when English councils are going bankrupt? For someone who speaks for England, why are you allowing this to continue?

    • The Prangwizard
      Posted September 9, 2018 at 3:37 pm | Permalink

      Mr Redwood does not ‘speak for England’. He speaks about it only and as a diehard Unionist England will thus always come second should it be a choice between England and the Union. Hence no promotion of or belief in a true English parliament.

  36. Ian F S Stafford
    Posted September 8, 2018 at 9:03 pm | Permalink

    The time has come to increase defence spending. The new threat from Russia may not yet be existential for the UK but it must be met. I am opposed to integration into a European armed force and am not persuaded by the argument that we need only to have bits of defence equipment to offer to the our allies to make up a viable force. We need to have full resources to command the air and sea Northern Approaches and the North Sea. Together with a fully sustainable expeditionary naval/ amphibious force. Your idea for using naval resources for disaster relief being put on the Aid budget sounds good. Perhaps that is also a way to have dual purpose patrol vessels which could be used in our fishing grounds.

  37. Chris
    Posted September 8, 2018 at 11:08 pm | Permalink

    The list is long but just some examples:
    completely revamp the Foreign Aid money/funding into an Emergencies/Disasters Fund and quit funding ferris wheels in Afghanistan.

    Ditch HS2 forthwith, and spend money improving existing networks.

    Ditch Hinkley.

    Ditch the green targets which were based on false/flawed science and invest the money wasted on wind and solar in opening up new coal and gas fired stations.

    Start investing in our own coal and steel industries as President Trump has done in the USA and thus bring back life and jobs to depressed areas.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, He graduated from Magdalen College Oxford, has a DPhil and is a fellow of All Souls College. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.

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