By Jaimie Kaffash
11 September 2009
Savings of £50bn a year could be made through cutting ‘non-performing schemes’, ‘over-extended government’ and ‘cutting out the middleman’, according to a report out today.
How to save £50bn, written by the Taxpayers’ Alliance and the Institute of Directors, recommends the abolition of the Sure Start and Building Schools for the Future programmes and the Education Maintenance Allowance. It also calls on ministers to cut civil service and non-frontline staff in health and schools by 10%.
The report says that spending cuts and reforms are needed but warns that the latter ‘do not save money immediately’. It argues: ‘Reducing the deficit, however, cannot wait and so both have to be put in place as soon as possible: reforms so that, in several years time, public services will be able to deliver more with less; and cuts to fill the immediate hole in the public finances.’ Failure to reduce the debt could lead to the UK ‘risking a trip to the International Monetary Fund mirroring the one in 1976’, it adds.
The authors of How to save £50bn add: ‘Governments have proved they are up to the task in previous years, and there is no reason why they cannot today.’ They cite Canadian cost-cutting policy of the 1990s, which reduced the country’s budget deficit from 9.1% to 0% in five years.
But Colin Talbot, professor or public policy and management at the Manchester Business School, says that the Canadian example is not valid. Writing on this website, he says: ‘The comparison with Canada’s federal government’s reduction of spending by 10%... ignores the fact that Canada is actually more like the US than the UK – it is a federal state,’ he wrote. ‘The spending cuts were in federal spending, whereas what is being discussed in the UK is cuts in the whole of public spending across central and local government. Canada’s cuts weren’t.’
And KPMG head of public sector Alan Downey describes the proposals as ‘something of a rag bag’. In his PF blog, he says savings are needed but the best way to achieve them is through ‘a programme to radically overhaul the way public services are provided, in line with best practice in the private sector’.
The Local Government Association says councils are already at the forefront of making savings. Responding to the report, chair Margaret Eaton said: ‘Local government is the most efficient part of the public sector and made savings of more than £3bn pounds between 2004 and 2007. Councils up and down the country are working hard to cope with a perfect storm of falling income and increased demand for services brought about by the recession.’
11 September 2009
Savings of £50bn a year could be made through cutting ‘non-performing schemes’, ‘over-extended government’ and ‘cutting out the middleman’, according to a report out today.
How to save £50bn, written by the Taxpayers’ Alliance and the Institute of Directors, recommends the abolition of the Sure Start and Building Schools for the Future programmes and the Education Maintenance Allowance. It also calls on ministers to cut civil service and non-frontline staff in health and schools by 10%.
The report says that spending cuts and reforms are needed but warns that the latter ‘do not save money immediately’. It argues: ‘Reducing the deficit, however, cannot wait and so both have to be put in place as soon as possible: reforms so that, in several years time, public services will be able to deliver more with less; and cuts to fill the immediate hole in the public finances.’ Failure to reduce the debt could lead to the UK ‘risking a trip to the International Monetary Fund mirroring the one in 1976’, it adds.
The authors of How to save £50bn add: ‘Governments have proved they are up to the task in previous years, and there is no reason why they cannot today.’ They cite Canadian cost-cutting policy of the 1990s, which reduced the country’s budget deficit from 9.1% to 0% in five years.
But Colin Talbot, professor or public policy and management at the Manchester Business School, says that the Canadian example is not valid. Writing on this website, he says: ‘The comparison with Canada’s federal government’s reduction of spending by 10%... ignores the fact that Canada is actually more like the US than the UK – it is a federal state,’ he wrote. ‘The spending cuts were in federal spending, whereas what is being discussed in the UK is cuts in the whole of public spending across central and local government. Canada’s cuts weren’t.’
And KPMG head of public sector Alan Downey describes the proposals as ‘something of a rag bag’. In his PF blog, he says savings are needed but the best way to achieve them is through ‘a programme to radically overhaul the way public services are provided, in line with best practice in the private sector’.
The Local Government Association says councils are already at the forefront of making savings. Responding to the report, chair Margaret Eaton said: ‘Local government is the most efficient part of the public sector and made savings of more than £3bn pounds between 2004 and 2007. Councils up and down the country are working hard to cope with a perfect storm of falling income and increased demand for services brought about by the recession.’
