Tuesday, 26 October 2010

Round-up of the Comprehensive Spending Review - David Hare, The Whitehouse Consultancy Ltd

Below, David Hare from The WhiteHouse Consultancy, gives a summary of last week's announcements regarding the Comprehensive Spending Review (CSR).

The CSR has been unveiled today and as predicted has made over £70 billion of real terms cuts over the period 2011-12 to 2014-15. The biggest winners from the CSR were health and international development – technically protected from cuts – but education also suffered less significant reductions than feared.

The budget of the Deptartment for Education will be down by 3.4% over the period, with schools budgets protected and a 12% reduction in other areas to allow this. Part of this reduction will come from rationalising or ending all centrally directed programmes, though what that means in practice remains unclear, particularly as the Government has committed to a national campaign to support families with multiple problems get the help that they need, suggesting some national programmes will be created.

The Pupil Premium will be introduced, Sure Start services will be maintained and extra Health Visitors will be recruited.

The main development for Special Educational Needs (SEN) is the announcement that children with SEN/disabilities will receive a personalised budget, though no information on how and when that will happen accompanied this announcement.

Local government will be forced to absorb significant cuts, suffering a substantial 27% reduction in real terms, though with far greater room for manoeuvre coming through the abolition of ring fencing in all but two areas. This extra flexibility is designed to help Local Authorities balance the books, but local government funding for services is likely to be highly constrained for several years. This will inevitably lead to a reduction in the number of contracts available for the voluntary sector, though for those contracts that do emerge, there is likely to be an extension of tariff payment mechanisms and payment by results and also a central government guarantee that a certain percentage of services must be delivered by the voluntary and independent sectors.

£470m will be made available to the voluntary sector to develop capacity, with some £100m being made available to support troubled voluntary agencies who deliver public services to keep that service going.

As Whitehouse has indicated for some time, the CSR has not set out every line of cuts that will be made by Departments; it has instead merely given Departmental allocations along with a few headline points as to what will go (and, also, what they have decided to retain). In some ways the more important announcements will come next month when all Departments set out their business plans to 2014-15, plans that will include more information on what has been cut.

No comments: