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Chancellor declares end of austerity

Time Published 16th September 2019

Chancellor Sajid Javid yesterday declared the end of austerity and revealed £13.8bn of investment in areas including health, education and policing, saying every government department has had its budget for day-to-day spending increased “at least in line with inflation.”

Mr Javid said a 4.1% rise in real-terms day-to-day spending is the biggest increase in 15 years. Public spending will rise to 38.6% of GDP in 2020/21, up from 38.1% last year and 38.3% this year.

The announcement includes: a £6.2bn increase in NHS funding; a £7.1bn boost for education spending by 2022/23; £750m for recruiting 20,000 new police officers; a 6.3% increase for Home Office spending; a 2.6% boost for the Ministry of Defence; and confirmation of an additional £2bn in Brexit preparation funding.

Paul Johnson, director of the Institute for Fiscal Studies, said Mr Javid’s plan marked a “real change in direction on spending,” although the IFS said spending would still be 3% below its level a decade ago, and more than 9% lower in per person terms.

To read Mr Javid’s speech click here.

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