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The Spending Review 2019 – An overview of the key announcements

Written by: Keith Tully

Reviewed: Tuesday 3rd September, 2019

Stack of British pound coinsChancellor, Sajid Javid’s, moment in the spotlight has been largely overshadowed by the continuing Brexit upheaval which shows no signs of stabilising. However, with Prime Minister, Boris Johnson, promising the “most ambitious spending round for more than a decade”, all eyes were on Javid this afternoon as he took to the podium to deliver the 2019 Spending Review.

The Spending Review traditionally focusses on allocating departmental budgets, with announcements regarding changes to taxation typically reserved for the Budget which will take place on an as-yet-unconfirmed date later this year.

However, with the prospect of a snap general election growing increasingly likely, this was a chance for the Tories to outline their proposed spending policies before their election campaign kicks off in earnest, with Javid seemingly keen to entice voters by putting forward a number of crowd-pleasing pledges within the Review. In fact Javid’s Review was later criticised by Shadow Chancellor, John McDonnell, who dismissed it as an act of “grubby electioneering”.

This Spending Review will only cover one year, rather the three which has been typical of previous announcements, indicative of the current uncertain political landscape. Despite this, he promised total spending would rise by £30.4bn next year thanks to a number of significant financial pledges aimed at bolstering key public service areas. Financial boosts for schools, hospital, and the police force were announced in an effort to reverse the austerity cuts of the past decade, and Javid also confirmed that no department would see cuts to their budget.

  • Brexit - He announced an additional £2bn war chest to go towards stabilising the country in preparation for the event of a no-deal Brexit. With the threat of the country falling into recession, this extra pledge coupled with the £2.1bn already promised, will hopefully go some way to providing an element of safety as we step into unchartered territory.
  • Crime - Previous promises to train and recruit 20,000 additional police officers coupled with an increase in prison places to tackle crime have been supported with a 6.3% increase to Home Office spending.
  • Healthcare - Turning to the NHS, Javid pledged an extra £6.2bn in funding over the next year. With a focus on training new doctors and supporting in the professional development of existing NHS employees, the fund is also to be used to assist with the much-needed redevelopment of 20 hospitals across the country.
  • Social Care - Funding worth £1.5bn has also been found for councils to improve social care. With local government funding having taken a hammering during the last decade of austerity measures, Javid’s proposed enhanced social care provisions are welcome. This represents the first post-inflation funding increase in over ten years, with spending in this area having taken a colossal 80% hit over the last decade.
  • Education - Schools are also in line for a financial boost with a £7.1bn increase in school spending promised by 2022-23. This will mean secondary schools will receive a minimum of £5,000 for every pupil, while starting salaries for teachers will rise to £30,000. 
Keith Tully

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Keith Tully
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Keith has been involved in Business Rescue since 1992, during which time he’s worked for both independent and national firms. His specialties include company restructuring matters and negotiating with HMRC on his clients behalf.

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