We have gone to great lengths in our public health emergency to tackle the coronavirus, however, it is not yet over, and the economic emergency has only begun. Today's Spending Review, therefore, delivers on the British people's priorities by protecting lives and jobs, delivering stronger public services, and introducing a one-in-a-generation investment in infrastructure. We are also levelling up all four corners of our country, and this Spending Review is one for the whole United Kingdom.
PRIORITY 1: PROTECTING JOBS
- In 2020 alone, the Government will have spent over £280 billion in our response to Covid-19, and the IMF, OBR and Bank of England have all praised our response to the pandemic.
- On top of regular spending commitments, an additional £55 billion has been confirmed for 2021 for all Government Departments to respond to the coronavirus, including:
o £18 billion for community testing, test and trace, PPE and vaccines.
o £3 billion to support NHS recovery from the impacts of the coronavirus.
o Over £2 billion to keep our transport arteries open.
o Over £3 billion to support local authorities to continue to tackle the coronavirus on the frontline.
o £250 million to help end rough sleeping.
o £2.6 billion to support devolved administrations in all parts of the UK respond to the coronavirus.
- We are providing nearly £3 billion for the new three-year Restart Programme, helping nearly 1 million people who have been unemployed for over a year, find work.
- However, in such drastic times for the job market, it is only right that we ensure fairness between the private and public sectors. In the six months leading to September, private sector wages fell by nearly 1 per cent, whereas public sector wages rose by nearly 4 per cent. In addition, many private-sector jobs have sadly ended, and many other workers have seen their wages and hours cut, whereas public sector workers have not. This is why today, we are targeting our resources at those in the public sector or need it most by:
o Providing a pay rise to over 1 million nurses, doctors and others working in our NHS.
o Protecting jobs by pausing pay rises in the rest of the public sector.
o Guaranteeing a pay rise of at least £250 for the 2.1 million public sector workers who earn below the median UK wage of £24,000, protecting the lowest paid.
o This means that the majority of public sector workers will still see an increase in their pay next year.
- Supporting the lowest paid in society by increasing the National Living Wage by 2.2 per cent to £8.91, to extend this rate to those aged 23 or over, and to increase the National Minimum Wage as well. These increases will benefit around 2 million people.
PRIORITY 2 : DELIVERING STRONGER PUBLIC SERVICES – MORE HOSPITALS, BETTER SCHOOLS, SAFER STREETS
- Next year, Government Department’s day-to-day spending will total £540 billion. Over this year and next, core departmental spending will rise, in real terms by 3.8 per cent – the fastest growth rate in 15 years.
- Boosting funding for our NHS by increasing the health budget by £6.6 billion next year. We are also increasing capital investment by £2.3 billion to invest in new technologies to modernise patient and staff experience, as well as building 40 new hospitals, upgrading 70 more.
- Investing more in social care by allowing Local Authorities to increase their core spending power by 4.5 per cent. This means they will receive £300 million of new social care grant funding and will have extra flexibility to increase council tax bills by 2 per cent and Adult Social Care Precept by 3 per cent.
- Levelling-up our Education and Skills sectors:
o Increasing the schools budget by £7.1 billion by 2022-23 – the biggest school funding in a decade.
o Committing £291 million to pay for more young people to go into further education, £1.5 billion to rebuild our colleges, and £375 million to deliver the PM’s Lifetime Skills Guarantee.
- Making our streets safer by cracking down on crime:
o Funding for the criminal justice system will increase next year by over £1 billion and we are on-track to meet our manifesto pledge to recruit 20,000 more police officers by 2023.
o Providing a four-year, £4 billion prison building programme.
- Strengthening the UK’s place in the world by providing more than £24 billion investment in our defence – the biggest sustained increase in 30 years.
- Continuing to meet our commitment to the world’s poorest by spending the equivalent of 0.5 per cent of GNI on overseas aid in 2021, allocating £10 billion in this Spending Review.
PRIORITY 3: DELIVERING OUR RECOVER INVESTMENT PLANS IN INFRASTRUCTURE TO DRIVE GROWTH, CREATE JOBS, AND LEVEL UP
- Next year, our total capital spending will be £100 billion - £27 billion more in real terms than last year.
- Providing a number of multi-year capital settlements for roads, rail, hospitals, schools, broadband and housing:
o Introducing a £7.1 billion National Home Building Fund, on top of our £12.2 billion Affordable Homes Programme.
o Delivering better mobile connectivity with 4G coverage across 95 per cent of the UK by 2025.
o Providing the biggest investment in new roads, railways, cycle lanes, and over 800 zero-emission buses.
o Providing £15 billion of new funding for research and development next year.
o Delivering the PM’s ten-point plan for climate change and creating 250,000 new green jobs across the UK.
- Creating a new UK Infrastructure Bank to help finance our plans – headquartered in the North of England and working with the private sector to finance major new infrastructure projects, starting this spring.
- Launching a new Levelling Up Fund worth £4 billion for local authorities in England to bid to fund local projects of up to £20 million.
UNLEASHING THE POWER OF THE UNION:
- This Spending Review is for the whole of the United Kingdom. Through the Barnett formula, today’s decisions increase Scottish Government funding by £2.4 billion, Welsh Government funding by £1.3 billion, and £900 million for the Northern Ireland Executive.
- We will ramp up funding so that total domestic UK-wide funding will at least match EU funding – this will on average reach around £1.5 billion a year.
- We will also accelerate four City and Growth Deals in Scotland – helping Moray, Tay Cities, Borderlands and the Scottish Islands create jobs and prosperity in their areas.