FINANCE

The false divide has become a false economy

Jessica Studdert says: 'The Spending Review is an opportunity to shift spending towards long-term, mission-aligned objectives even within a tough fiscal climate, but the Government needs to end the false divide between protected and unprotected departments.'

Jessica Studdert © New Local

Jessica Studdert © New Local

The false divide between ‘protected' and ‘unprotected' departments is becoming a false economy.

In Whitehall, silos are easy to uphold. They literally exist in different buildings – health, education, local government, work and pensions. Each has separate teams, accountability and ministerial oversight. From inside the Treasury building, making tough decisions about spending allocations, it is logical to single out each department separately.

The consequences of artificial separation between departments have long been seeping into our collective experience of public provision

And so, over the years of spending restraint, the notion of departments protected from deep cuts (health and education) and those unprotected (the rest, including local government) has defined parameters. Now, once again, ahead of a stringent summer Spending Review, unprotected departments are being required to model up to 11% reductions.

On an individual level, there is a deep interconnection between the outcomes each department is responsible for. Education is a big determinant of job prospects. Unemployment impacts health, which is a barrier to employment. And lots of people out of work mean rising welfare costs.

The consequences of artificial separation between departments have long been seeping into our collective experience of public provision. Reduced spending in one area creates rising costs in another.

For example, as unprotected social care is pared back, unmet demand pops up in protected, but rising, health budgets. The false divide has become a false economy – acute costs mount while the case for preventative investment upfront to alleviate crises is all the harder.

The Spending Review is an opportunity to shift spending towards long-term, mission-aligned objectives even within a tough fiscal climate – but the Government needs to end the false divide between protected and unprotected departments.

Bridging national policy silos and individual experiences, it is across places that budgets can be pooled, services can integrate around community needs and better overall outcomes can be more effectively sustained.

Jessica Studdert is chief executive at New Local

FINANCE

The impacts and risks of immigration and skills policies

By Oliver Lodge | 05 June 2025

Closer collaboration across Government departments and local authorities is vital to securing the benefits of immigration and protecting workers, says Oliver...

FINANCE

A story of smarter SEND funding

By Natalie Kenneison | 05 June 2025

Natalie Kenneison says that despite soaring SEND deficits, a quieter story of progress is unfolding that shows what’s possible when councils take a structure...

FINANCE

Councils' watershed moment

By Martin Ford | 05 June 2025

Next week’s Spending Review will have huge implications for the future finances of local government. Martin Ford looks at what we know so far, and the key qu...

FINANCE

Shovel-ready Spending Review

By Heather Jameson | 05 June 2025

The local government world is divided into two types of people: those who are resigned to their financial woes as a long-term reality, and those who look hop...

Jessica Studdert

Popular articles by Jessica Studdert