The Chancellor yesterday announced that seven departments have now agreed reductions in their spending levels for 2015-16.
Much of this spending will take place after the next General Election, widely expected to be in May 2015. It is normal for the outgoing government to leave in place a spending and tax plan or budget for the incoming government, even where as in 2010 it was highly likely they would lose. In 2015 the current government is not standing again as a Coalition government, so the new incoming government is free to change things if they wish.
Clearly there are good management reasons why this needs to be done. The country needs to have a budget for the first three months of 2015-16, the period of the old government, of the election and first weeks of the new government. As this remains an area of largely national competence for the UK,the new government in May 2015 is at liberty to change both the tax and the spending plans on taking up office.
Once the government has set its 2015-16 budget it is likely Conservative Ministers will say they would keep to that budget should they form a majority government. The pressure will then be on the two Eds for Labour to say what changes if any they would want to make to such a budget, as they will know the exact numbers broken down by department. Once the budget is agreed, there will be a standard to judge other budgets by, a centre for the debate over how much to spend and how much to tax.
It looks as if the government plans to keep the ring fence protection of the NHS in place. I think this is a sensible call, given the huge pressures on the NHS budget. Taking the NHS and the pension pledges together, that places more downward pressure on the remaining budgets, as over one third of public spending is protected. The protection afforded to Overseas Aid will become more contentious, local authority budgets will be under more pressure, and the government will need to consider for how much longer public sector pay can rise faster than private sector pay.