Massive public service funding issues will soon have to be confronted in Britain.
The NHS annual winter crisis has self-evidently been worse than ever this year, with the pending threat of a flu epidemic. A longer-term solution needs to be found to the service’s limitless cash requirement. The funding of adult social care remains subject to ad hoc sticking-plaster solutions: successive governments have failed to tackle the underlying problem.
Defence is in trouble because big-ticket items such as aircraft carriers and a replacement for Trident are draining money away from armed forces’ numbers. Ministers and defence chiefs are now publicly lobbying for additional cash. New year train fare rises and a fall in passenger numbers have highlighted the unsustainable nature of railway funding. And so on.
Domestic policy has reached an unsustainable position with the government having randomly to find billions for services such as prisons, schools, potholes and social care where earlier cuts have led to failure. On top of this, Brexit still needs huge policy effort, notably for migration, a post-CAP agricultural subsidy system, a radical, new, approach to training and skills, plus dozens of post-EU ‘regain control’ decisions. With the economy only growing at a sluggish 1.5% a year, there is no supply of magic money. The immediate costs of leaving the EU have yet to be revealed.
If nothing is done in the long term, the UK risks reaching a position where its public sector consists of little more than a health service and nuclear warheads. And possibly High Speed 2. But not much local government. The prime minster certainly needs to broaden her government’s vision for the country. There will either have to be tax increases or an acceptance that the State has to stop doing a large number of things.
Local government continues to be penalised for being able to manage down its spending while retaining satisfaction. There is no effective lobby for council services, apart from social care. The very fact local authority spending has fallen by a third and is also managed well is used within Whitehall as an argument to cut it further. When it comes to public expenditure lobbying by departments, nothing succeeds like failure.
Tony Travers, director, LSE London