Jeremy Hunt’s plans likely to harm public services, says report | Policy for public services

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Jeremy Hunt’s autumn statement is expected to bring further cuts to public services, with even those getting extra funding, such as schools and the NHS, unlikely to recover from the damage caused by Covid, a leading think tank has said.

The Institute for Government (IfG) said the statement given last week and invoiced by the chancellor as generous under the circumstances, was deliberately front-loaded, leaving any post-2024 government with some hugely difficult spending decisions.

Its report also says less protected services, particularly the criminal justice system, are likely to face effective cuts, with the sector unlikely to see reductions in court backlogs or prison overcrowding.

Hunt’s decision to delay most spending cuts for two years from now “leaves some very difficult spending decisions for the next government, whoever that may be”, the report said.

Nick Davies, IfG’s program director and one of the report’s authors, said: “Most services will be worse off in 2025 than they were 15 years earlier – with devastating consequences for the people who rely on them. This is a poisoned legacy for whoever forms the next government.”

It is unclear, say the report’s authors, whether it will be “politically tenable for the next government to keep public spending down in line with Hunt’s plans”. There will be problems caused by the £22bn of cuts in day-to-day spending planned for the 2025-26 and 2027-28 financial years and other factors, the IfG says.

One issue highlighted is the continued slow recovery of public services from the impact of the Covid-19 pandemic. Another is wages, which make up more than half of public sector budgets. With significant pressure for higher pay and the likelihood of strikes if this does not happen, headlines showing seemingly generous spending settlements may mean little actual improvement.

Areas that receive extra money, such as NHS, schools and local authorities, should be able to meet demands caused by demographic changes and inflationary pressures, the report says. “But they will struggle to do much more than that. In each of these, performance is currently well below pre-pandemic levels, and the money injected is unlikely to be sufficient to bring it back to those levels.”

With criminal justice in particular, a small real increase in funding already planned over the next two years will mean that demand is “likely to exceed expenditure by a significant margin”.

The authors say: “Prisons and courts are in a particularly dire state, with problems felt before the pandemic seriously exacerbated by it, and the spending decisions announced in the Autumn Statement mean there is little prospect of making meaningful reductions in the Crown Court backlog or to safely house the expected increase in the number of prisoners.”

In contrast, the report says they pledged an extra £3.3bn. to the NHS, aimed at reducing ambulance and A&E waiting times, and better access to GPs, should deal with the rising demand – although it looks highly unlikely to be enough to cope. backlog or to address long-term staff recruitment and retention issues.

Correspondingly, a funding boost to the schools’ budget will restore the core funding per pupil to real 2010 levels by 2023-24, says the IfG. However, this is unlikely to cover expected salary allocations and is “also unlikely to make up for the learning lost during the pandemic – the schools’ equivalent of the ‘backlog’ felt in other services”.

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