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Don’t spare ‘inefficient’ schools and NHS from spending cuts, says audit watchdog
Paul Waugh, Deputy Political Editor1 Jul 2009
Frontline NHS and education services are "inefficient" and should not be exempt from spending cuts, Britain's public services watchdog has warned.
Audit Commission chief executive Steve Bundred declared it was a "big mistake" for Labour and the Tories to rule out reducing health and schools budgets and said they should be subject to the same savings as other departments.
His remarks came amid fresh criticism of Lord Mandelson's announcement that the next public spending review will be delayed until after the general election.
The CBI warned that putting the review on hold until next year or 2011 would lead to greater "uncertainty about the broad direction of the public finances" among businesses.
The Conservatives have claimed that Labour is hiding from future spending cuts that will have to be made to balance the nation's books.
But Mr Bundred warned that both main political parties have failed to grasp the need to slash spending across all areas. Speaking at a fringe event at the Local Government Association's annual conference, he said: "Both political parties have pledged that whatever happens they will protect health and education.
"I think that's a big mistake. Health and education are the two services that have been most generously funded over the past decade but they are among the most inefficient services."
His remarks were heard by housing minister John Healey, who attended the event.
Mr Bundred later said there had been huge variations in costs for comparable frontline services - not just in back-office administration - and should be spared the demand for savings.
It also emerged today that Cabinet ministers have expressed concern over Gordon Brown's attempt to use a crude "Tory cuts versus Labour spending" attack line in the run-up to the next election. Lord Mandelson, now effectively the Deputy Prime Minister, was forced to apologise to Chancellor Alistair Darling after saying on Monday that there would be no public spending review before the election.
The Business Secretary rang Mr Darling following his BBC interview and was later forced to "clarify" that all decisions remained with the Chancellor.
Treasury sources say Mr Darling may still outline a set of future Whitehall savings early next year.
Ministers want to refine Labour's message on spending, combining more openness about the cuts that will have to be made with claims that David Cameron will follow a Thatcherite policy of "unfair" tax and spending reductions. Treasury Chief Secretary Liam Byrne seized last night on an admission by shadow chancellor George Osborne that he would not protect education from possible spending cuts and would only exempt health and international aid.
When asked if he would exempt schools and Sure Start centres, Mr Osborne said: "I am not protecting other areas at this stage."
Mr Byrne said the Tories had wrongly claimed that they were denied access to government figures on spending to distract attention from the issue of education cuts.
Mr Osborne said that Labour's failure to be honest about spending had led to the Prime Minister's policy relaunch to collapse into "shambles and chaos". There was fresh controversy over Mr Brown's £1.5 billion housebuilding plan as some departments, including the Home Office, contested Treasury figures for how much they would have to provide to fund the project.
The Standard understands that the Department for Communities and Local Government will have to find £530 million in "reprioritisations" of its budget to help foot the bill for 11,000 more low-cost homes. The cuts could come from cash earmarked for councils.
Reader views (2)
I have heard this "debate" again and again. What you think you can afford comes from your gut feeling about life. Compassion is inclusive and leads to healthcare, education, etc; extremists at both ends hate public anything and admire the kind of strength that takes because it can.
Newspapers publish what fits their poliical philosophy and panders to the bias of their readership.
The needy die and we never know what genius they may have had.
Socrates asked "How shall men live?" and we still haven't got a clear answer.
Yawn
- Mikey, London UK, 07/07/2009 11:41
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As a country, we are in a terrible recession and have racked up a huge debt over the last 10 years. We can not afford to have any sacred cows.
- Jeremy E, Home Counties, 01/07/2009 11:33
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