Desperately seeking a long-term diagnosis

By Iain Murray | 11 March 2024

I think my expectations had been suitably managed ahead of last week’s Budget and while there is always hope it was also always going to be in vain.

Having put the disappointment to one side I still find myself feeling slightly irked. I had a similar feeling after last November’s Autumn Statement. I’ve been asking myself why that is. Budgets are political as much as fiscal events and we are in an election year so it isn’t the pre-election giveaways which are at the root of my frustration. The populist positioning is irritating but I’ve become somewhat immune to that now.

The focus on public sector productivity is an interesting one. I partially agree with the diagnosis, productivity is an issue that impacts our economy as a whole and is not restricted to the public sector but there are other issues such as levels of inequality which also impact on our overall prosperity as a nation. I am not convinced by the cure. I am sceptical about whether the £3.4bn of capital spending allocated to pump prime the NHS productivity plan is the right decision in a sector which has been deprived of capital. I think NHS bodies could find better ways to spend that money if they were given the freedoms to do so. My scepticism turns to cynicism when it comes to local government productivity plans which were announced as part of the settlement a few weeks ago. I fear these will, by necessity, be paper based exercises which act as a distraction rather than as a tool for potential change. 

Budgets sit at the heart of public financial management. They are fundamentally a plan and this one was badged as a ‘Budget for Long Term Growth’. Headline-grabbing as that might sound it couldn’t be further from the truth and I think that is at the crux of my underlying angst. I think this is exacerbated by the sense that the role of public services within that plan are either not well understood or well enough respected. A successful economy needs to be built around world class infrastructure and skilled and healthy people; public services are essentially to the delivery of both. What we desperately need is a long-term vision supported by long-term financial planning to allow organisations to invest and grow. This week’s Budget did not provide us with that.

Iain Murray is director of public financial management at CIPFA


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Local economies Finance Infrastructure CIPFA Autumn Statement Budget productivity