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Budget 2010 - Protecting public services

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Issued 24 march 2010

Public services play a vital role in supporting Britain’s long-term growth and competitiveness.

The Government has confirmed it will stick to planned levels of overall departmental spending in 2010-11 to help support the economy as it recovers, building on investment that has delivered lasting improvements in public services over recent years.

From 2011-12 onwards, spending will be restrained to help halve the level of public borrowing as a proportion of the economy over the next four years.

However, Budget 2010 confirms that the Government will protect frontline services - in schools, 16 to 19 education and Sure Start, frontline NHS, and police numbers - in the years to 2012-13.

The Budget also sets out further details on the tough choices the Government is making in other areas of public spending, including:

  • Budget confirms that public sector current expenditure will grow at a slower annual rate between 2011-12 and 2014-15, alongside falling levels of public sector net investment;
  • a new Code of Practice on setting pay for senior public sector workers, following the pay freeze for these workers in 2010-11. The Government will also seek a one per cent cap on increases in public sector basic pay for 2011-12 and 2012-13, generating savings of £3.4 billion a year by 2012-13;
  • department-by-department identification of efficiency savings underpinning the £11 billion total saving through smarter government, halving spending on consultants, reducing the number of quangos, and using online systems to provide information and advice to the public;
  • details of £5 billion of savings by 2012 through better targeting and prioritising of spending, better procurement and cutting lower-priority programmes; and
  • reforms to the welfare system and reducing social security spending by a further £300 million by 2013-14 on top of existing forecast savings of £1.2 billion.

The following chart shows where taxpayers’ money is spent:

This pie chart shows where taxpayers’ money is spent. Total managed expenditure: £704 billion. Comprising: Social protection: £169 billion; Personal social services: £33 billion; Health: £122 billion; Transport: £22 billion; Education: £89 billion; Defence: £40 billion; Industry, agriculture and employment: £20 billion; Housing and environment: £27 billion; Public order and safety: £36 billion; Debt interest: 43 billion; Other: 74 billion. Source: HM Treasury 2010-11 near cash projections. The allocation of spending to functions is largely based on the United Nations’ Classifications of the Functions of Government (COFOG). Other expenditure includes: general public services, (including international services); recreation, culture and religions; public service pensions; plus spending yet to be allocated and some accounting adjustments. Social protection includes tax credit payments in excess of an individual’s tax liability, which are now counted in AME, in line with OECD guidelines. Figures may not sum due to rounding.


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Article Published/Sorted/Amended on Scopulus 2010-03-25 10:51:23 in Economic Articles

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