APSCo News: Tough Choices Ahead on Public Spending

Source: BBC News – “IFS says tough public spending choices unavoidable” 

The UK government faces ‘unavoidable’ decisions on public spending, according to a recent warning from the Institute for Fiscal Studies (IFS), as reported by the BBC.  

With a Spending Review due on 11 June, which will outline departmental budgets and investment budgets, it is expected there will be significant implications for how funding is distributed across key sectors. 

The IFS notes that spending on health - projected to reach £202bn in 2025-26 - will dominate departmental budgets. The Government is focused on reducing wait times and increasing dental care access, so financial cuts would be pulled from other departments.  

Areas like the criminal justice system, local government, and transportation are facing potential budgetary pressure. According to the BBC, the IFS noted that achieving these goals would be particularly challenging given the government's plans to reform the criminal justice system and reduce prison overcrowding. 

In a significant development announced this morning (BBC News, 4 June), Chancellor Rachel Reeves has committed £15.6bn to new transport infrastructure projects across England. The investment will fund extensive tram, rail, and bus upgrades across regions including Greater Manchester, the West Midlands, Liverpool, West Yorkshire, and the North East. 

The move marks a shift in how Treasury projects are evaluated, moving away from traditional value-for-money rules that have historically favoured London and the South East. While this announcement signals increased regional investment, it also raises questions about how this spending aligns with the overall constraints outlined by the IFS and what trade-offs may be required in other public service areas. 

Can productivity help improve public services if we are faced with tighter budgets? 

Improving productivity in public services is seen as a potential way forward - but current productivity levels remain below pre-Covid benchmarks, according to the Office for National Statistics (ONS). The IFS notes that sustaining services on tight budgets will require ‘ruthless prioritisation’. 

Implications for Employers 

Constraints on public sector funding - from policing and health to education and transport - may impact talent demands, workforce planning, and recruitment pipelines across multiple sectors. These funding decisions shape the workforce environment and may influence hiring trends, investment priorities, and regulatory focus areas. 

For the full article and further context, we recommend reading the BBC’s original piece: Spending Review: Tough choices unavoidable, says IFS - BBC News 

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