Chancellor Sajid Javid has announced that departments will see their spending limits increase "at least in line with inflation" in 2020-21, telling MPs that this is the first time in 15 years no ministry has faced cuts in a spending review.
In a fast-tracked review of spending levels for 2020-21, Javid confirmed the funding for a series of policy pledges announced since Boris Johnson became prime minister, including a £6.2bn NHS spending increase in the year and a £2.6bn increase in the schools budget, as part of plans to increase spending by £7.1bn by 2022-23.
Overall, day-to-day departmental spending will grow by 4.1% above inflation in 2020-21, with an overall £13.8bn more for public services, according to the Treasury.
The chancellor also announved a £1bn grant to support local authority social care, and a £1bn funding increase for the Home Office to begin recruitment of 20,000 police officers by 2023, with around 6,000 expected to be in place by March 2021.
Other spending splurges also include an extra £2.2bn for the Ministry of Defence to spend on the armed forces, and a £500m increase to the Ministry of Justice budget to begin building 10,000 additional prison places.
Javid told MPs that this “big increase in public spending” would invest in “the people’s priorities” and added that this “inevitably means difficult decisions elsewhere” in government budgets.
“Every spending review presented to this House over the last 15 years has had to find cuts from [some] departments,” he said. "This party has never shied away from the difficult decisions to live within our means. Those decisions were tough, but they have paid off.
“And so I can announce today that no department will be cut next year. Every single government department has had its budget for day-to-day spending increased at least in line with inflation. That’s what I mean by the end of austerity.”
Labour reviews in both 2004 and 2007 planned some year-to-year cuts to departments – transport and the Northern Ireland Office in 2004 and the transport, business, environment and work and pensions departments, and the Foreign Office, in 2007 – although CSW has not been able to verify that these plans were implemented as planned. The 2010 Spending Review introduced the then-coalition government’s austerity drive.
Javid said the review would “deliver on the people’s priorities across the NHS, education and police, giving certainty to all departments about their budgets for next year, and clearing the decks for government to focus on delivering Brexit”.
The chancellor said that, as he announced "spending plans for Britain’s first year outside the European Union" the government is " turning the page on austerity and beginning a new decade of renewal.”
Announcemes included a £90m pot for 1,000 diplomats and overseas staff and 14 new and upgraded diplomatic posts to prepare for Brexit, as well as a pledge to continue the government’s GREAT campaign promoting inward investment and tourism to Britain.
The Department for Digital, Culture, Media and Sport has been asked to develop proposals for a new Youth Investment Fund to get young people off the streets through improved and new youth centres.
Javid also confirmed that £2bn would be made available in 2020-21 for spending related to leaving the European Union.
In his statement, Javid commended the Treasury civil servants for delivering “the fastest Spending Round in history”.
'Brexit prep hindered by civil service pay restraint'
However, responding to Javid, shadow chancellor John McDonnell said that the statement was an “electioneering stunt” after Johnson indicated yesterday he would seek to call an election.
“The Tories have checked what are the top three or four issues in the polls and cynically judged just how little money they have to throw around to try and neutralise the concerns people have about those issues” he said.
“To come here and then try to fool us with references to people’s priorities is beyond irony.”
Also responding to the chancellor, PCS general secretary Mark Serwotka said: “The money being promised by the chancellor is like sticking a plaster over a gaping wound.
“The promise of extra border force staff and more money for Brexit preparations is too little too late,” he said. “The government has tried to prepare for Brexit by having an austerity mentality, allowing tens of thousands of civil service jobs to be lost since 2010 and imposing pay restraint.
“This is particularly highlighted by the office closure programme in HMRC where we are losing high levels of expertise at a time when we need investment to deal with any exit from the EU. The government has claimed that freedom of movement will end on 1 November. We have not got the necessary infrastructure in place to deal with a no-deal Brexit both at our airports and ports and regarding any new customs arrangements.”