Today Osborne, Chancellor of the Exchequer, will present the Comprehensive Spending Review to the House of Commons with plans for further cuts over the next four years until the 2020 General Election. Because more than half of public spending is ringfenced, or ‘protected’ from cuts, other unprotected departments will be hit very hard. In July this year, Osborne wrote to heads of unprotected departments asking them to develop a plan to reduce their spending by 25 to 40%, which means that if plans go through, they would see cuts of around 50% since 2010.
BIS is one of the unprotected departments and is expected to see cuts of around 30%, which will ultimately restructure BIS itself. Under the guise of ‘simplifying’ the landscape, it is understood that BIS’s 80 sites will be reduced to 7. Cuts expected in BIS is expected to be a particularly strong blow for HE and FE, as they are unprotected (unlike research & science spending) under the BIS budget (as well as the DoE in FE’s case). It is expected that cuts will be made through the removal of BIS quangos (such as the research councils), the replacement of maintenance grants and bursaries with loans, changes to postgraduate loans, serious cuts to teaching funding, and redundancies of dedicated experts in the sector.
With the Government intending to eliminate the £90bn budget deficit by 2019/20, it means that we will see all public services under severe pressure. There is little doubt that these changes will lead to huge structural changes to key departments in central government.
Global BU will be investigating the implications of the CSR more in the coming days.