Spending Review 2015: Osborne aims for “a country that lives within its means”

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George Osborne spending review 2015

George Osborne revealed a far-reaching spending review today in the British Parliament with an ambitious goal to save up to £20 billion over the next 4 years. This is on top of the already announced £12 billion savings from welfare cuts as well as a claimed £5 billion from shutting down tax avoidance and evasion schemes.

In parliament, Osborne states that the United Kingdom government is still borrowing £1 for every £10 that is spent and that the rising national debt is a significant risk for economic security.

Whilst the cuts will come from a wide range of services and existing programs, Osborne stated that the NHS and national defence forces will be a top priority for investment. These cuts are claimed to have the country running a surplus by 2019.

Everything is on the table

Osborne cites a fall in crime, the NHS being named the best healthcare system in 2014 (by the Commonwealth Fund) and an increasing number of students taught in good or outstanding schools despite reorganisation and streamlining of the police, healthcare and education system as evidence that cuts are still providing good public services.

Another big cost savings plant being made by Osborne is through governmental devolution. Noting that devolution has already begun across the U.K., the spending review aims to give more power to local authorities to control their budgets for public services in an effort to make them more efficient.

A potential shock for civil servants, the government is keen on looking into pay reforms and is planning to abolish contractual progression pay across the entire Civil Service. In addition, improved financial management is named as a way to get “the most value for taxpayers’ money” across all of the 17 major departments.

Selling off excess land (the taxpayer currently owns £300 billion worth) with the goal of using that land to build more houses has also been proposed.

Overall, the biggest savings plan seems to come from an overall streamlining of services rather than huge cuts in a few specific areas. Cutting financial waste in departments, allowing local authorities greater control of their budgets (and being responsible for their own debts) and a program to sell land to ostensibly build houses might be a better pill to swallow for the opposition than the earlier welfare bill.

Image credit: Parliament TV