Major departmental savings revealed in Spending Review 2010
Summary
Chancellor George Osborne announced £81 billion worth of savings to be implemented by 2014-15 in the Coalition Government’s first ‘Spending Review 2010 (Cm. 7942)’.
Inheriting one of the most challenging current fiscal positions in the world, the government strives to reduce the nation’s largest deficit in its peacetime history.
The current welfare system will see significant reform with over £7 billion worth of savings, and the prevention of wasteful spending will also be a key focus.
The Coalition Government will prioritise:
- the NHS;
- schools;
- early years provision; and
- the capital investments designed to support long-term economic growth.
The review sets out a new vision for financial stability in Britain, pinpointing:
- Growth: to create the conditions that enable UK businesses to be successful through investment and creation of jobs and prosperity for the whole country.
- Fairness: to build a fairer and more mobile society through a new fairness premium – worth £7.2 billion in total over the Spending Review period, it will support the poorest in the early years and throughout their education.
- Reform: to generate new and innovative ideas to address the complex social and economic challenges facing the UK today.
Public service reform underpins the Review: decentralisation of power; cutting burdens and regulations on front-line staff; and improving transparency, efficiency and accountability of local services. Local government will have greater freedom but must work within reduced allocations. Public sector pensions will be reformed in line with Lord Hutton's recommendations.
The Spending Review takes decisions to:
- Support private sector growth and investment through prioritised spending.
- Deliver outcomes that support growth where the private sector would not.
- Set out the measures to improve opportunities for everyone across the UK.
- Incentivise the transition to a low carbon economy.
In late 2010, each Government department will publish a business plan outlining visions and priorities until 2015 along with a structural reform plan.
A White Paper will also be released in early 2011 to maintain momentum for reform and further analyse how to improve delivery of services to society.
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