BBC summary of Spending Review N0v 2015

Wednesday, November 25th, 2015

Key points:

  • Chancellor George Osborne has set out the state of the economy in the Autumn Statement and spending plans for the next four years in the Spending Review. Here are the main points:

Spending Review headlines

  • As a result, government to breach overall welfare cap in first years of Parliament
  • Total spending to rise from £756bn this year to £821bn by 2019-20
  • State spending to hit 36.5%, as a share of total output, in five years – down from 45% in 2010
  • Overall day-to-day departmental spending to fall by 0.8% each year by 2020, lower than during the 2010-15 Parliament
  • Policing, health, education, international aid and defence budgets protected
  • Transport, environment and energy among biggest losers, resource budgets falling by 37%, 15% and 22% respectively

Police, security and justice

Image copyright PA
  • No real-terms cuts in police budgets in England and Wales, with spending to rise by £900m by 2020
  • Forces expected to make efficiency savings by sharing resources
  • Holloway women’s prison in London to close as part of modernisation of estate, including nine new prisons
  • Underused courts to be sold off, raising £700m for new technology
  • Defence budget to rise from £34bn to £40bn by 2020, with extra cash for the security services
  • Overseas aid budget to increase to £16.3bn by 2020, while Foreign Office budget protected in real terms

Welfare and tax credits


  • £12bn in targeted welfare savings to be delivered in full
  • Housing benefit for new social tenants to be capped at same level as private sector
  • Housing benefit and pension credit payments to be stopped for people who leave the country for more than one month
  • Department of Work and Pensions budget to be cut by 14%
  • Job centres to be co-located in council buildings
  • Conditions for benefits to be extended to more than one million more claimants

Health

  • Health budget in England, currently £101bn, to rise to £120bn by 2020-21
  • The NHS in England to get upfront cash injection of £6bn next year as part of £10bn added funding
  • NHS in England expected to make £22bn in efficiency savings
  • An extra £600m earmarked for mental health services
  • Grants for student nurses to be scrapped and replaced by loans
  • Cap on training places for nurses scrapped, with goal of increasing numbers by 10,000
  • New social care “precept” in council tax of up to 2% to allow local councils to raise £2bn for social care
  • Better Care Social Fund to be increased by 1.9%
  • £15m raised from charging VAT on sanitary products to be given to women’s health charities

Education

  • Schools budget in England protected in real terms
  • Total education budget to rise by £10bn in 2020
  • School funding formula to be phased out
  • New 30-hour free childcare subsidy for parents of three-and four-year-olds to be limited to those working more than 16 hours a week
  • Sixth-form colleges allowed to become academies
  • Funding for Further Education colleges to be “protected in cash terms”

Housing and local government


  • New 3% surcharge on stamp duty for buy-to-let properties and second homes from April 2016, raising about £1bn
  • Restrictions on shared ownership to be removed and planning system reformed to deliver more homes
  • London Help to Buy scheme to offer interest-free loan worth up to 40% of the value of a newly built home
  • Plans to hand billions to private developers to build 400,000 new homes in England
  • Local government to keep all revenue from business rates by the end of the Parliament
  • Councils to receive extra £10m to help homeless people
  • Local government spending, in cash terms, to be same in 2020 as 2015

Business, science, energy the environment

Image copyright Science Photo Library
  • Business department funding to be cut by 17%
  • 26 new enterprise zones to be created
  • Uniform business rates to be abolished, with elected mayors allowed to raise rates under certain conditions
  • Science budget to rise in real terms to £4.7bn
  • Apprenticeship levy set at 0.5% of employer wage bill, with £15,000 allowance for eligible firms
  • Funding for flood defence to be protected in real terms
  • Energy Companies Obligation to be replaced in March 2017 and Renewable Heat Incentive cut by £700m

Pensions, savings and personal taxation

Image copyright Reuters
  • State pension to rise by £3.35 a week to £119.30 next year
  • Savings credit to be frozen at current level
  • Every individual and small business to have their own digital tax account by the end of the decade

Infrastructure, transport and culture

Image copyright Getty Images
Image caption Almost 6,000 lorries can be held on the M20 during Operation Stack
  • Capital funding of transport projects to rise by 50% by 2020
  • £250m support for motorways in Kent to relieve pressure caused by Operation Stack
  • Culture department to see funding cut by 5%
  • Extra cash for Arts Council and UK Sport
  • Free museum entry to be maintained

State of the economy and borrowing


  • Growth of 2.4% forecast for 2015, unchanged from June
  • Growth in subsequent years forecast to be 2.4%, 2.5%, 2.4% and 2.3%
  • Borrowing forecast to total £73.5bn this year, falling to £49.9bn, £24.8bn and £4.6bn in subsequent years before hitting surplus in 2019-20
  • Debt to be lower in 2015-16 than 2014-15 and to fall every year after that
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