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The concerns of future spending

As the next Comprehensive Spending Review looms, policing academic Dr Tim Brain examines the implications on law enforcement

The 2013 Spending Review will be announced on June 26. It was the last Labour government that started the spending review process in 1998, when they stuck to their election commitment and followed the spending limits of the outgoing Conservative administration of John Major. It gained the new government a reputation for fiscal ‘prudence’ and ushered in a sustained period of economic growth. General economic growth continued in Labour’s second and third term but it was then accompanied by spreading the growth to the public sector. The triennial series of reviews from 2001 to 2007 saw public spending increase from 34.6 per cent of Gross Domestic Product (GDP) in 2000-1 to 40.7 per cent in 2006-7. Health, Education and Welfare did best, but ‘Public Protection’, of which the Police Service amounted to about half, also did reasonably well, growing from 2.2 per cent of GDP to 2.4 per cent.

The impact of the recession

The system worked well until government debt ballooned as a result of the 2009 recession. At first the continuing effects of the 2007 spending review protected the public services, but it was only a stay of execution. Received economic wisdom demanded that public sector expenditure be curtailed.

As the 2010 general election approached all the main parties had some form of spending plan to restrict public expenditure, but the Conservative-Liberal Coalition that emerged as the new administration developed the most radical. For the Coalition the absolute requirement to rein in public spending in the face of the recession was a blessing in disguise. Cut public spending and economic recovery was bound to follow.

SR 2010

The 2010 Spending Review (SR) was the delivery vehicle for economic recovery. It would be hard, even brutal, but the medicine would be worth it in the long run. Over the period from 2010/11 to 2014/15 spending on government departments would be cut by 20 per cent, although because Health, Education and Overseas Aid were ‘protected’, the net effect on the remaining departments would be 25 per cent. It would be worth it, however, because by 2015, just in time for the next election, the country would be debt free and economic recovery would continue unbridled. It has not, of course, worked out in this way, as the economy has stubbornly failed to burst into life.

In past recessions the police had been relatively protected compared to other departments but that favouritism ended in 2010. The Police Service with a cut of 20 did fair slightly better than some other departments, but it still ranked as a ‘loser’ compared to the winners of Health, Education and Overseas Aid.

The effect on the police

In a personnel intensive service such as the police it was inevitable, despite early protestations from government, police leaders and even staff associations to the contrary, that financial cuts would be most acutely felt in terms of officer and staff numbers. Projections settled around losing somewhere in excess of over 30,000 Full Time Equivalent (FTE) by the end of the spending review period in 2014/15. By September 2012 the service had lost over 19,000 FTEs since the highpoint for police numbers in 2010 and was therefore on curse to meet those forecasts.

Losing over 30,000 officers and staff in five years would normally be a matter of extreme public concern and political criticism, but these were not normal times. With all public services, even to a lesser degree the so-called ‘protected’ ones, the police was in no position to offer much in the way of special pleading, especially as the Conservatives had by and large won the intellectual battle in labelling the police as the ‘last unreformed public service’. Furthermore, with a series of adverse news stories, including ‘Hackgate and ‘Mitchell Gate’, breaking at regular intervals and crime continuing to fall to record low levels, there was little political pressure on the Coalition to change tack, even if police morale was obviously suffering.

SR 2013

There is no written rule about these matters but the review to be announced on June 26 should cover from 2015/16 to 2018/19, but it’s not. It will add just one more year, 2015/16, to the current span. There is no particular reason for this, except that a general election is due in 2015 and thus gives a second term Coalition, or even Conservative majority government, maximum room for post election manoeuvre.

The government has already signalled SR 2013’s broad parameters. Public spending will be cut by 2.8 per cent. However, these cuts will not fall evenly because Health, Education and Overseas Aid will again be ‘protected’. This means that the remaining departments will have on average to sustain cuts of 8 per cent, unless that is their respective political heads can do better in the so-called ‘horse trading’ that is preceding the review.

The Home Secretary and her performance

The Home Office has already settled its allocation in good time for the SR 2013 announcement. Has the Home Secretary managed to negotiate some abatement of the cuts? The Institute for Fiscal Studies has speculated that the Home Office might be in the region of 2-6 per cent which would be a substantial improvement on the 8 per cent average. If this happens it would be a considerable political achievement for Mrs May and presumably represent a reward for the progress made in securing the Winsor review recommendations. It would also mean other departments, possibly Communities and Local Government, would have to take a bigger hit, maybe up to 12 per cent.

Of course, even with 2-6 per cent cuts there would still be pain. The cuts would be in addition to the losses accrued up to March 2015. Taking into account further cuts required by the 2012 autumn Treasury Statement, cuts of 8 per cent would mean the loss of approximately a further 16,000 FTEs; at 6 per cent it would be nearer 12,900. If the settlement came out at 2 per cent cuts then the loss would be in the region of 6,500.

There is still much uncertainty, however, and these figures are no more than indicative. If police and crime commissioners increase council tax this will mitigate some of the losses, although with referendums being triggered if council tax rises by 4 per cent or more the scope is limited. The Home Office expects that its efficiencies and cost saving initiatives will produce mitigating effects of up to the ‘equivalent’ of 2,100 FTEs, although it must be noted that the ‘equivalent’ is not the same as actual FTEs. Non-personnel budget lines could be squeezed further, but the scope for this is limited as well.

Becoming inured to cuts

Two per cent cuts would represent a political victory for the Home Secretary, but this demonstrates how inured we have become to cuts. One way or another it is likely that by March 2016 the Police Service could have lost in the region of 40,000 FTEs taking numbers back to those last seen in 2003-4.

This is clearly a survivable scenario, but it is likely to mean further diminution of neighbourhood policing capacity. After all, Her Majesty’s Inspectorate of Constabulary has already acknowledged that the frontline might have been ‘protected’ but it has not been ‘preserved’.

There is a further problem in the mix. What is going to happen in the years from 2016 to 2018 not covered by SR 2013, especially if the economy continues to ‘flatline’?

Would Labour do things differently? With Shadow Chancellor Ed Balls committing a future Labour government to maintain Coalition spending plans, at least in its initial years, it seems not.

Tim Brain is a former chief constable of Gloucestershire Constabulary.

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