by GK Strategy 10th July, 2014

Savings Continue to Dominate Policy Agenda

Four years on from Former Chief Secretary to the Treasury Liam Byrne’s infamous note to his successor, David Laws, it is fair to say that the truth of the statement is still as relevant today as it was in those early days of the Coalition. With all of the main political parties finalising key policy inclusions for their manifestos ahead of the 2015 General Election and the Spending Review which will almost certainly follow, the importance of policies being fully-costed and evidence-based is clearer than ever. Indeed, after a number of perceived high profile “broken promises” in recent years on spending commitments – not least with the Lib Dems on the funding of higher education – we can expect all of the parties to be extremely careful and make sure any commitment is priced up.

The Local Government Association’s (LGA) own “manifesto”, Investing in our nation’s future, launched this week, taps into the current political consensus on the direction of public spending and purports to enlist a range of measures which would save the public purse no less than £11 billion. On what, though? £3.9 billion would be saved from “enabling health and wellbeing boards to commission primary, secondary and social care services” and £3.5 billion saved from moving to a more preventative approach to health care through reform of the tariff system. These policies would be complemented by better using the proceeds of tobacco and alcohol duty and VAT to improve public health.

While other measures such as local youth transition services also contribute to the LGA’s cost cutting vision, it is interesting to note this particular focus on health as an area for savings, particularly after the recent debate about how to plug a £2bn hole in the NHS’s finances. The question here is whether the narrative of clinical and political leaders can be translated into action and produce a genuine transformation of services on a mass scale? So far we have witnessed too little evidence of this, but the stakes are ever-rising and the health service simply can’t endure another five years in its current state.

Regardless of the outcome of the 2015 General Election, financial challenges across the public sector will continue to feature as an overriding theme for many years to come. Any organisation that can support Government in making savings – whether through improving health and social care services, helping to reduce procurement costs or in any number of other manners – has an instant advantage in advancing its case with Government.

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