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Government winners and losers in the UK budget




Prime Minister Rishi Sunak announced an overall increase in funding for the Whitehall Department on Wednesday, with total spending expected to rise by more than £150 billion for the remainder of this parliament.

As Sunak observed in his speech, the new three-year spending cutout was “considered and contrary to speculation” that many smaller departments such as transportation, justice and local government would face cuts in daily spending.

Instead, Sunak said “every single department” would see a substantial increase in overall spending, and public investment in the economy would be “at its highest level lasting for nearly half a century”.

Torsten Bell, director of think tank Resolution Foundation, said the prime minister took advantage of the faster-than-expected economic recovery after the coronavirus pandemic to prevent the department from facing a bluff as public finances return to a sustainable basis.

“What we’ve seen is massive spending during the immediate Covid-19 recovery period, but that means things will get more difficult as the spending period ends,” he warned.

Among Wednesday’s biggest winners was the Ministry of Health, where daily spending increased by 3.8%, and the Department of Foreign Affairs and Development, whose budget surged unexpectedly due to plans to restore Britain’s foreign aid spending in 2024. -25.

The relatively loser did not receive enough cash for the Ministry of Justice to handle the balance of more than 60,000 cases in England and Wales, lawyers said. Research funding delayed by two years, with the government target of spending £22 billion per year on R&D.


Healthcare services, extended to the tipping point due to the Covid-19 pandemic, will receive an additional £5.9 billion in capital expenditures, with the core budget increasing by an average of 3.8% over the spending review period to £162.6. 1 billion in 2024-25.

However, it was not clear how much money would be available for education and training to address the NHS’s critical staffing shortage. Instead, there were only broad promises to “provide hundreds of millions of pounds in additional funding … to ensure a larger, better-trained NHS workforce”.


To the dismay of campaigners, funding to provide preventive and therapeutic services has not increased, despite the epidemic revealing a link between poverty and poor health outcomes.

Nigel Edwards, chief executive of the Nuffield Trust, welcomed the Prime Minister’s announcement of a 3 per cent increase in all local government services, but warned it was insufficient to address “the disastrous situation in social welfare”. .


Another sector hit hard by the coronavirus, education, received an increase of £18.4 billion during the parliamentary period, equivalent to a real growth rate of 2% per year, according to the Ministry of Finance.

After the lockdown, an additional £1.8 billion was promised to make up for the learning lost by children, bringing the total to £5 billion, which educators say is still far below the £10-15 billion experts estimate needed. .

“The investment announced today does not meet these goals or the future needs of the country,” said Paul Whiteman, executive director of the National Association of Teachers.

Sunak has also pledged £1.6 billion for 16-19 year olds, with funds primarily allocated to launch T-Level, a new career qualification that the government hopes will become a major career path after the GCSE.

But failing to fully account for plans to fund colleges, tight allocations to the coronavirus chase, which are short of what educators need, and plans for college spending, the sector remains open about whether the government will follow its promises to deliver a “tech revolution.” I became suspicious. “.

David Hughes, chief executive of the Association of Colleges, said the overall investment is not enough to make a real difference in the field. “A world-class technology system needs more investment than this after more than a decade of cuts,” he said.

Level Up, Community & Housing Department

Local government was also a winner, and Sunak received a significant cash input that it declared “the biggest increase in core funding in a decade.”

The department’s budget is one of the biggest increases in all of Whitehall, up 9.4% to £12.5 billion by 2024/25. However, this will bring funds back to 2010 levels after 10 years of a 40% decline in central government subsidies.

Jonathan Carr-West, CEO of the Local Government Information Unit think tank, admitted that the budget is “more generous” than expected. “The more pain-prepared sector will feel things could be worse this afternoon,” he said.

Ministry of Work and Pension

Institute for Fiscal welfare expert Tom Waters said the decision to relax universal credit benefits conditions and slow the rate at which payments are withdrawn when beneficiaries enter work also marked the DWP as one of the budget winners. research.

A higher spending plan for the UK would result in a more than 2% increase in the so-called “block subsidies” that Westminster sends to the attributing governments of Scotland, Wales and Northern Ireland.

The Prime Minister said the raise would be the largest settlement since the settlement was handed over in 1998, but Welsh and Scottish politicians said the funds were insufficient to cover the costs of COVID-19 and Brexit. Welsh Finance Minister Rebecca Evans said it was “totally inappropriate”.

Ministry of Justice

The Ministry of Justice received £477 million in aid over the next three years to handle court balances, which increased by 19,000 during the pandemic, and funds growing at an average annual rate of 3.3%, but it met with lukewarm response from the Ministry of Justice. job.

Jo Sidhu QC President of the Criminal Bar Association, which represents criminal lawyers, said the fund would be “window dressing” for thousands of crime victims awaiting justice.

Lawyers added that hopes to reduce court balances have been limited by a shortage of lawyers and judges needed to go to trial after leaving the profession after cutting legal aid rates and attorneys’ fees over the past decade, lawyers added.

Ministry of Transport

This is another area where experts say raising funds is not enough. The Treasury will allocate £5.7 billion over the next three years, continuing to put billions of dollars into the UK rail network to help train operators cope with the decline in passenger numbers due to COVID-19. However, of the £1.5 billion announced on Wednesday of the £7 billion pledged to boost transport across the UK’s seven market urban areas, only £1.5 billion in new funding.

Ed Thomas, UK Transport Head at KPMG, said: “It’s an important first step, but urban areas will see available funds that fall short of what is actually needed to level the local economy and decarbonize the transport system.

Department of Defense

Last fall, the Department of Defense secured £16.5 billion in capital expenditure over four years to fund new investments in digital warfare. The cost of this modernization program has already triggered cuts in some areas, including a 10% or more reduction in the number of troops, with an army of 72,500, the lowest in three centuries.

But Wednesday’s budget documents showed that annual growth in routine defense spending fell 1.4% between 2021 and 2025. Labor said this would affect salaries and pensions for the military.

FT Correspondents: Peter Foster, Sarah Neville, Bethan Staton, Jane Croft, Sebastian Payne, Laura Hughes, Mure Dickie, Helen Warrell, Clive Cookson, Philip Georgiadis, Judith Evans, Robert Wright




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