George Osborne carries the 2015 Spending Review as he leaves the Treasury. Photo: Tim Ireland / PA Images
#SpendingReview 2015 – the Touchstone blog round up
George Osborne’s first Spending Review of the new parliament has hit the headlines for his spectacular U-turn over drastic cuts to tax credits. It avoids the hardship it would have inflicted on millions of low-paid families, though as Richard Exell points out, the cuts to Universal Credit are still there and will hit more people over time – 31 million of them, mostly in working families.
There were other things to welcome too. Tim Page highlighted a positive change in attitude towards a more active industrial strategy, something our hard pressed steel industry in particular will need to see real detail on, and quickly.
Another mini U-turn saw threatened cuts to adult learning reduced – possibly because of income from the Apprenticeships levy. Iain Murray looked at what the changes would mean for skills and learning.
And unions have been pressing too in recent weeks for a deal that would #FullyFundOurNHS, and a last minute deal seems to have emerged. Matt Dykes looks at what we got – a front-loaded settlement to help with the current crisis, but a boast of the “biggest ever commitment to the NHS” that didn’t really stack up.
The Chancellor was bullish about the doubling of the housing budget (from 2018), but worryingly had nothing on social housing. Without a focus on those on growing waiting lists or in substandard private rentals, Paul Sellers is concerned extending ‘right to buy’ will only make things worse for low paid households, rather than better.
Local government was hit very hard, with the announcement that the main central government grant to it would be phased out by the end of the parliament – a 50% cut on local government’s money from the centre. Alice Hood says this will have profound consequences, even if the optimistic projections are realised.
And there was a catastrophic blow to UK carbon capture and storage programme, as the entire £1bn funding for this work was cut. Philip Pearson says this completely the wrong signal the week before the Prime Minister goes to Paris for the UN climate change conference – compounded by the damage the government have recently wrought to UK renewables.
Geoff Tily looked at the figures on investment, which told a different story to the positive mentions in the speech. The projected investment spend for this parliament will worryingly be 20% down on the last.
Scarlet Harris says the announcements on the ‘tampon tax’ and funding for charities working on women’s health and domestic violence are awkward and ill thought out.
And Janet Williamson looks at pensions; state, workplace and local government.
So how did he do it? Geoff Tily looks at the accounting behind a budget funded in part by changes to economic forecasts. The reality remains a spending review of massive cuts, and as Frances O’Grady wrote, a series of measures from which ordinary working people will emerge the losers.