Latest Public Sector News

10.10.12

North East hit twice as hard by cuts as Wales

Public sector spending cuts have hit Wales less than the most comparable regions in England, new research shows.

A report by the Institute for Fiscal Studies (IFS) shows that overall council spending, excluding education, has so far been cut to only half the extent of councils in the north east of England, which has a similar socio-economic profile.

The Welsh Government has been in discussions with the UK Government to negotiate more funding through the Barnett formula, which is now unlikely to be revised in the foreseeable future.

The report, commissioned by the Welsh Local Government Association (WLGA), states: “The North East of England, the region of England most similar to Wales, has seen a reduction in overall spending, excluding education, around twice as large as that in Wales – 18.7% versus 9.3%. This has involved larger spending cuts in all service areas with the exception of fire services.

“The cuts in some areas have been very great indeed. For instance, expenditure on planning and development has been reduced by 57.4% versus 22.9% in Wales, and spending on regulation and safety has been reduced by 44.3% versus 24.5%.

“This suggests that Welsh unitary authorities may be able to deliver further significant reductions in spending in such areas although not necessarily without reductions in the quality and number of services provided.

“However, local authorities in the North East have also had to make much larger reductions in spending on social services – 11.8% versus 4.8% in Wales – suggesting that as the scope for making further cuts to areas like planning and development diminishes, important ‘core’ services such as social services cannot be protected as much.”

The report is at: www.ifs.org.uk/pr/pr_051012.pdf

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