Latest news with #publicSpending
The Independent
4 days ago
- Business
- The Independent
Can Reeves calm Labour's troubled waters with her spending review?
The term 'fiscal event' hardly does justice to the significance of the government's comprehensive spending review, due to be published on Wednesday 11 June by the chancellor, Rachel Reeves. It's been in preparation more or less since Labour took office last July. It matters at least as much as any Budget because it sets out broad public spending plans for each area of government. These cover planned investment and current spending in areas such as wages, but exclude cyclical items such as unemployment benefits. So they are a strong statement of the Labour government's priorities. All the signs are that it's been a difficult process, and the leaks and the spinning have already begun. What's the trouble? Trying to balance the books (in reality borrowing huge but manageable sums) is the answer to that. In an environment of great global uncertainty, alongside sluggish UK growth thanks to Brexit, and in a country with an ageing population, Reeves's task is an unenviable one. In addition, she will have to balance the pressing political demands of colleagues with her determination to stick to her 'fiscal rules'. Specifically? At the moment, backbenchers in the red wall seats in the North and the Midlands that Labour regained from the Tories at the general election are pressuring the Treasury to pour billions into much-needed investment in infrastructure, to make the most of the industrial potential of these neglected areas. This would also, of course, have a helpful electoral benefit for those MPs who are facing a challenge from Reform UK. Reeves has hinted that she could adjust her rules on investment spending to facilitate tens of billions to be devoted to levelling up the regions. Sounds familiar? Yes, indeed. Although Labour chooses not to use the loaded slogan 'levelling up' about 'left behind' communities, it is very much what Boris Johnson promised in 2019 and, for good and bad reasons, wasn't delivered as expected in the last parliament. Before that, George Osborne, Tory chancellor from 2010 to 2016, talked ambitiously about devolution, the ' Northern Powerhouse ', and the 'Midlands Engine'. There was even a red wall caucus of Tory MPs, named the Northern Research Group (NRG), who lobbied hard for successive Tory administrations to live up to their promises (most of the NRG members have since lost their seats). The ultimate symbol of Tory failure was the cancellation of the HS2 rail project, launched with so much hope by David Cameron but miserably dismembered by Rishi Sunak at the 2023 Conservative Party conference. In Manchester. In a former railway station. Now, exactly the same dynamic is operating within the Starmer administration. There are some big personalities involved? Yes: Angela Rayner, deputy leader and deputy prime minister, for one. Powerful as her office makes her, she also has an excellent case for expanding the 'affordable homes fund', because of the importance Labour placed on the housing crisis and its target of 1.5 million new homes to be built during its first parliament. This was always a tough one – so much so that it's been reported that Rayner threatened to quit in exasperation and Tony Blair had to persuade her out of it (a story she denies). She is also surely right to get some adequate funding into local authorities before many more fall into chaotic bankruptcy, which would look like carelessness if not incompetence on the part of Rayner. Other ministers putting up a fight are Yvette Cooper at the Home Office, Ed Miliband (Energy), and Steve Reed (Environment). Liz Kendall (Work and Pensions) and Reeves will also need to persuade their backbench colleagues to back whatever welfare reforms they eventually settle on – ideally, restoring the pensioners' winter fuel payment, lifting the two-child cap on child benefit, and ameliorating planned cuts to disability benefits. Defence and Health are the only areas likely to escape demands for 'efficiency savings'. What can Labour backbenchers do? The spending review is an odd beast, because unlike, say, a finance bill, it's not legislation and doesn't necessarily have to be voted on; and for that matter, a government doesn't have to stick to it (even if it wants to). It's just a 'plan', a statement of intent, and a series of signals about priorities. But some sort of backbench rebellion seems inevitable, even among the usually loyal 2024 intake, even if only by proxy. At a minimum, they will certainly expect some signs of the imminent restoration of the pensioners' winter fuel payment – the cutting of which was hated by the voters and would have saved little money – and on progress to end child poverty. Will there be resignations? There's talk of Rayner being pushed to the limits of her patience, again, and her resignation would be cataclysmic. However, in most cases of a politician wrestling with their conscience, their conscience usually loses. Rayner would not be thanked for abandoning the administration less than a year into its life. Even worse, as the party is already suffering in the polls, she would thereby be hastening the onset of the ultimate catastrophe – a Farage-led government. She would attract at least as much scorn and blame for that as she would gain respect for standing up for working people, or whatever. She might, as others have in the past, improve her chances of winning the leadership in due course by making a tactical move to the back benches now, but she's said she's not interested in the top job, and her treachery would probably cost her dear in any case. Having come this far, she'll most likely stick with it. Others, maybe some more junior ministers with an eye on the long game, might decide to leave office 'on principle'. But this would not affect the outcome of the spending review, which is ultimately going to be more cuts.
Times
21-05-2025
- Business
- Times
Tom Hunter's rescue plan for Scotland: lower taxes and follow Singapore
One of Scotland's richest men has demanded lower taxes to reverse the 'managed decline' of the country. Sir Tom Hunter, Scotland's first homegrown billionaire, said he was 'deeply worried' by the future prospects of his homeland in areas such as education, health and the economy. In a new paper he suggests Scotland should look to Singapore as a blueprint which would improve its economic fortunes. Hunter argued that lower taxes along with a bespoke immigration system would attract more talented people and help grow the overall tax revenue the government collects. That in turn would allow for greater public spending to help overhaul public services. 'The current state of our nation does not reflect our potential,' Hunter said. 'I have never heard so much
Times
21-05-2025
- Politics
- Times
What Angela Rayner's leaked tax raid memo tells us about Labour
Since entering government Angela Rayner has been remarkably quiet. Where many had expected her to be one of the most forthright characters, especially given her schooling in the trade unions, she has largely kept her head down. Behind the scenes, however, there have been reports of discontent. At a cabinet meeting earlier this year she was one of several ministers who raised their concerns about the scale of welfare cuts and public spending restraint. There were also claims that at one point she was so frustrated with the government's target of building 1.5 million homes by the end of this parliament — a target she is responsible for delivering — that she considered quitting. Until now she has been scrupulously on message. However, the leak
Times
16-05-2025
- Business
- Times
Officials failed to prevent misuse of public money at water regulator
Government officials failed to prevent an 'unacceptable use' of taxpayers' money at the nation's troubled water regulator, MSPs have found. A 'catalogue of failures' at the Water Industry Commission for Scotland (Wics) led to inappropriate spending, the report published on Friday concluded, including £200-a-head meals, gift cards for staff and a £77,000 Harvard business course for a senior manager. Alan Sutherland, the former chief executive of Wics, stepped down after the publication of a damning Audit Scotland report in December 2023. Its findings prompted further investigations into the quango, which uncovered more instances of spending outside public finance guidelines and Donald Macrae, the chairman, resigned in October last year. The body acts as the economic regulator for Scottish Water and is supposed to
Daily Mail
15-05-2025
- Health
- Daily Mail
SNP's £100million bill for spin doctors amid crisis gripping Scotland's health service
More than £100million of taxpayers' money has been spent on spin doctors by Scotland's public sector while the NHS and other services are in crisis. SNP ministers have been urged to stop squandering so much money defending their 'atrocious' record after the extraordinary spin bill was racked up over the last three years. An army of 642 spin doctors is now employed by the Scottish Government and 93 other Scottish public bodies, including councils, quangos and health boards, to promote the work that they are doing in the media. The annual cost of press and communications staff has rocketed by nearly a fifth over the course of just three financial years, from £30.7 million in 2021/22 to £36.7 million in 2023/24. Scottish Conservative finance spokesman Craig Hoy said: 'Taxpayers will be astonished that, at a time when they are making swingeing cuts, the SNP Government are squandering an absolute fortune on spin doctors. 'This is money that could be spent on frontline services but is instead effectively being used to try to defend the SNP. 'It's breathtaking hypocrisy from John Swinney, who, before he came into office, was an arch-critic of public money being lavished on spin doctors. The Scottish Conservatives believe in getting value for money for taxpayers by spending funds on public services, rather than vanity projects. 'But while our NHS is in crisis, John Swinney's priority is to waste taxpayers' cash trying to defend his party's atrocious record. It's just another example of the bloated public service the Nationalists are presiding over.' The Scottish Government's own press and communications bill was £11,971,508 in the three years to the end of 2023/24. It increased from £3,739,924 in 2021/22 to £4,097,722 the following year and £4,133,862 in 2023/24. Over the three year period, the 32 local authorities spent just under £32 million on press and communications, while 10 NHS boards which provided figures spent £7.8 million. The full time equivalent number of press and communications staff increased from 609 in 2021/22 to 642 in 2023/24. The lavish spending came over a period where the SNP Government imposed income tax hikes, with everyone earning more than £30,300 now paying more in Scotland than the rest of the UK. All 32 local authorities have also forced through a series of council tax rises, including an average increase of £116 in the financial year which began last month with individual councils imposing rises of up to 15.6 per cent. At the same time, Scotland's NHS has been mired in crisis with major concerns about waiting times for key treatments, delays in accident and emergency wards, and growing pressure on GPs and the Scottish Ambulance Service. Mr Hoy said that the £100 million spent on spin is the same amount as the SNP has budgeted to 'mitigate' the Labour Government's cuts to the winter fuel payment, and also how much they were prepared to spend to support mid-market rents in a housing emergency. He added: 'But when it comes to protecting their reputation with taxpayers' money, the SNP are happy to spend like a sailor on shore leave.' The biggest spend on press and communications by any public body in 2023/24 was the Scottish Government's £4.13 million bill, followed by Police Scotland's bill of up to £3.79 million, Glasgow City Council at £1.52 million, City of Edinburgh Council at £1.41 million and NatureScot at £1.29 million. Other seven-figure sums were spent by exams quango the Scottish Qualifications Authority, at £1.27 million and the Scottish Environment Protection Agency, at £1.06 million. Of the 10 health boards to provide figures, total spending increased from £2.39 million in 2021/22 to £2.59 million in 2022/23 and £2.83 million in 2023/24. The biggest bill for a single health board last year was £654,790 at NHS Lanarkshire, followed by £361,145 at NHS Greater Glasgow and Clyde and £356,946 at NHS Grampian. A Scottish Government spokesman said: 'Effective communication, including through work with journalists and through social media, is essential to raise awareness of government policies and to encourage uptake of key public services. 'Public sector organisations have a vital role in delivering on their priorities for the people of Scotland. Decisions on spending on communications are operational matters for individual organisations to make.'
