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CHANCELLOR ANNOUNCES PROGRESS ON WORK FOR THE NEXT SPENDING REVIEW

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Further details on the key reviews that will form the backdrop to the ...
Further details on the key reviews that will form the backdrop to the

next spending review have been announced by chancellor Gordon Brown.

The terms of reference for three reviews were announced yesterday:

- The Devolving Decision Making Review which will examine how best to

achieve decentralised delivery and responsive local and regional

services. This will be done in a way that is consistent with equity

and efficiency, and against a clear framework of national

standards.

- The Childcare Review which will consider whether the long-term

projection for childcare and early years education is sufficient to

meet the government's aims for employment and educational

attainment. It will look at how fast the sector can expand and what

more needs to be done in particular areas such as childcare for

school age children and the role of extended schools.

- The Child Poverty Review will set out what further action is

required to halve child poverty by 2010 and eradicate it by 2020.

It aims to ensure the welfare system and the range of public

services work together to avoid the waste and poor outcomes which

still occur all too often. Among the specific issues it will look

at are increasing employment opportunities; improving the

effectiveness with which current investment in public services

tackles material deprivation; improving life chances; and dealing

with the crisis points that families often face, all with an eye to

the particular issues facing families in deprived areas.

The review of the voluntary and community sector will focus

specifically on five public service areas: health and social care;

crime and community cohesion; education and employment; housing and

homelessness; and children and families. It will build on the

foundations laid in last year's cross-cutting review of the role of

the voluntary and community sector in service delivery and will make

practical recomme ndations about specific areas where government, the

voluntary and community sector and social enterprise can work

together even more closely to deliver world class public services.

The chancellor also announced that the first stage of the

review of efficiency in public services will be completed later this

month. The review examines new ways of providing departments, their

agencies and other parts of the public sector with incentives to

exploit efficiency savings, and so release more resources for front

line delivery. It will make proposals for strengthening the drivers

of efficiency and offer examples of existing good practice in the

wider public sector. The review will lay the basis for a continuing

programme of work to improve efficiency.

Paymaster general Dawn Primarolo, will lead the Review of Financial

Support for 16-19 year olds. The review is examining the incentives

for young people to participate in education and training and the

interaction between this support and any new minimum wage for 16 and

17 year olds. The review will look at ways of improving the system of

financial support in order to increase young people's participation

in education and training and at ways to simplify the system

radically in the long-term. The Paymaster General will work with

children's groups, the Local Government Association, the Low Pay

Commission and in consultation with young people and their parents.

It will report in spring 2004.

Michael Lyon's review on the scope for relocating public sector

activities from London and the South East is conducting a public

consultation on the impact of previous relocations and the economic

effects of decentralization. In parallel Government Departments are

preparing proposals for relocating activities and contributing to the

Review.

In addition to the reviews that will feed into SR2004, Derek Wanless

has been asked to provide an update on the long-term challenges in

implement ing the 'fully engaged' scenario to improve population

health as set out in his 2002 report. The terms of reference will be

published in due course.

Notes

1. Further background including, where published today, the terms of

reference, on each Review are set out below.

Review of Efficiency in Public Services

2. Budget 2003 said that the Government would 'review new ways of

providing departments, their agencies and other parts of the public

sector with incentives to exploit opportunities for efficiency

savings, and so release resources for front line delivery'.

3. The first stage of this work is due to be completed by July 2003

and will deliver:

- examples of the tools and good practice being used and mechanisms

for spreading these;

- examples of the scope for raising efficiency through redesigning

services.

4. The Review is drawing on the work of the Public Services

Productivity Panel, and consulting a wide range of people across the

public services. The study covers the whole of public services, not

just the work of civil servants or the activities of central

government. It is envisaged that this Review will lay the basis for a

continuing programme of work to improve efficiency in the use of

resources and inform decisions in the 2004 Spending Review.

Devolved Decision Making

5. The devolved decision making review was commissioned in Budget

2003, following on from the Chancellor's speech to the Social Market

Foundation on 3 February. The Review has the following terms of

reference:

'to examine in the run up to the next Spending Review how best to

achieve decentralised delivery and responsive local and regional

services in a way that is consistent with equity and efficiency,

against a clear framework of national standards.'

6. The review has two closely linked parts:

- exploring the rationale for devolving decision making to regional

and local levels, looking at how it could improve service delivery

outcomes, establishing an agreed approach to devolving decision

making and identifying new approaches to locally-empowered service

delivery in particular areas; and

- working closely with the Prime Minister's Delivery Unit, looking at

how to combine the current targets regime with a drive for greater

devolution of decision-making and greater transparency. This will

consider how to develop a new system of data collection and

performance indicators, which both maintains the high minimum

standards implied by current targets and unlocks customer and

citizen pressure for local service improvements and is, therefore,

much more responsive to the needs and aspirations of local

communities.'

7. The review will draw on the considerable work taking place in

related areas, including:

- the Balance of Funding Review, which is considering whether it

would be desirable to increase the amount of money raised at the

local level;

- the Innovation Forum, which is considering what future freedoms and

approaches could be developed in: education, social services for

the elderly, community safety and how services can be better joined

up at the local level;

- work to improve Local PSAs for the second round, enhancing the

scope for a clear focus on local priorities;

- work to refresh the Comprehensive Performance Assessment (CPA) for

2005-06 to tie the CPA in more closely with the aims of the

Community Strategy to assess more explicitly the influence and

impact of local authorities on their particular localities; and

- evidence from the United States on real time performance

indicators.

Voluntary and Community Sector

8. The Voluntary and Community Sector Review was commissioned in

Budget 2003. The Review will build on the Cross-Cutting Review of the

Role of the Voluntary and Community Sector in Service Delivery,

published last September as part of S pending Review 2002. The Cross-

Cutting Review recommended that Government and the voluntary and

community sector work together to reinforce and improve the

day-to-day relationships between the sector and the state, by

improving funding arrangements, building capacity, and ensuring full

implementation of the Compact.

9. It was announced today that this Review will build on the

foundations laid in the Cross-Cutting Review by examining selected

public services within five categories:

- Health and Social Care;

- Crime and Community Cohesion;

- Education and employment;

- Housing and Homelessness;

- Children and Families.

10. Within these categories the Review will examine selected public

services where the voluntary and community sector and social

enterprise can and do add value, explore the existing relationship

between the sector and the state at the central and local level, and

make recommendations about where Government, the voluntary and

community sector and social enterprise can work even more closely

together to deliver world class public services, whilst maintaining

the independence of the sector.

11. The review will be practical in focus and aims to build upon and

reinforce the key recommendations of the Cross-Cutting Review of the

Role of the Voluntary and Community Sector in Service Delivery

(http://www.hm- treasury.gov.uk/media//AFF00/CCRVolSec02.pdf), and on

the Government's Social Enterprise Strategy

(http://www.dti.gov.uk/socialenterprise/strategy.htm).

Childcare

12. The terms of reference of the Childcare Review, published today,

are to consider:

- whether the long-term projection for childcare and early years

education is sufficient to meet the Government's aims for

employment and educational attainment;

- whether the expansion is proceeding quickly enough;

- and whether there are areas where more remains to be done.

13. The review will be conducted by officials fro m relevant

departments and draw on the expertise of others. The review reflects

the high priority the Government attaches to issues affecting

children, as seen also in the recent appointment of the new Minister

for Children.

Child Poverty

14. In the light of the new long term measure for child poverty,

which will be published by the end of 2003, the Review intends to set

out the policies necessary to:

- increase employment opportunities, raising incomes for those who

can work;

- increase support for those who cannot work;

- improve the effectiveness of public services that tackle material

deprivation, for instance housing and homelessness;

- improve those public services that can contribute most to

increasing the future life chances of children in households

suffering low income, for example education, and ensure public

services and the welfare system work well together when families

face crisis points in their lives; and

- improve services for children and their families living in deprived

areas, including targeted programmes.

15. The Review will work across Government drawing in expertise from

the research community and the voluntary sector.

Financial Support for 16-19 Year Olds

16. Budget 2003 set out the Government's plans to establish a wider

cross- government group to examine the overall system of financial

support for 16 to 19 year olds. The review will examine:

- the financial incentives for young people to participate in

education and training and the interaction between this support and

any new minimum wage for 16 and 17 year olds;

- the financial support for young people and their parents or carers,

including those who are living independently and those in very low

paid employment; and

- how the system of financial incentives and support could be

rationalised, given the variety of channels through which it is

currently delivered.

17. The Chancello r announced today that the Review will be lead by

the Paymaster General who will work with children's groups, relevant

Government departments, the Local Government Association, the Low Pay

Commission and in consultation with young people and their parents.

It will look at ways of improving the system of financial support to

increase young people's participation in education and training. The

Review group will include and develop analysis undertaken by

Department for Education and Skills, Department for Work and Pensions

led group, the Social Exclusion Unit and the Children and Young

People's Unit. The Review will report in spring 2004.

Sir Michael Lyons' Review on Relocation

18. Budget 2003 invited Sir Michael Lyons to lead an independent

review to examine the scope for relocating a significant number of

public sector activities from London and the South East to other

parts of the United Kingdom. Sir Michael is identifying options, in

the context of Departmental pay and workforce strategies, for

relocations that will improve the delivery and efficiency of public

services and improve the regional balance of economic activity.

19. The terms of reference as set out in a joint letter from the

Chancellor and Deputy Prime Minister are:

'In the light of the need to improve:

- the delivery and efficiency of public services; and

- the regional balance of economic activity;

- and, taking account of departmental pay and workforce strategies,

updated to reflect relocation plans. Sir Michael Lyons will make

recommendations to the Deputy Prime Minister and the Chancellor for

the relocation of civil service and other public sector workers, by

November, to inform the next Spending Review.'

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