CIPFA and IfG issue pre-Budget warning over public service sustainability

27 Feb 17

The UK faces the prospect of failing public services and breached spending controls unless urgent action is taken, the Institute for Government and CIPFA have warned.

The think-tank has partnered with the accountancy body to deliver an assessment of key public services in light of increasing cuts imposed by central government.

The Performance Tracker review concludes that until recently, Whitehall was able to maintain the performance of public services while cutting spending. However, the report highlighted that the government’s own data indicates the existing approach has “run out of steam.”

The authors urged the chancellor Philip Hammond to demonstrate in next week’s Budget that his spending decisions were based on “realistic assessments”.

They added that, in the near future, the government risks “bouncing from spending crisis to crisis” against the backdrop of contentious and potentially divisive Brexit negotiations.

The report identified the key pressures on adult social care, hospitals and the prison services. It noted that people were waiting longer for critical hospital services such as A&E and cancer treatments, and highlighted delays in transferring people from hospitals into social care have risen by 40% since 2014. Meanwhile, violence in prisons has risen sharply, with assaults on staff increasing by 61% in two years.

Among the recommendations made by the report was for the assumptions behind government’s spending decisions to be subject to independent scrutiny. As such, Whitehall should consider creating an institution similar to the Office for Budget Responsibility for public spending, which could help “embed efficiency within public sector decision making and prevent wishful thinking.”

Rob Whiteman, chief executive of CIPFA, said: “We know that for some parts of the public sector resources are stretched and that those working to deliver services are up against it. What is crucial is that we make the best possible use of the funds available.”

A thorough understanding of how organisations are run and services provided was key, “using this information to think strategically and creatively about improving policy decision making, which will ultimately improve service delivery.”

Julian McCrae, deputy director of the IfG, added the government was entering a cycle of “crisis, cash, repeat.” He emphasised the new report was not a call for money but rather, “a call for better financial planning” and reforms robust enough to endure public scrutiny.

“It is fundamental to increasing the effectiveness of these public services that ministers, officials and the public know how well government is performing, and use this information to guide decisions,” he stated.

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