Interesting Q & A on MANAGING BUDGETING IN GOVERNMENT
ORAL EVIDENCE TAKEN BEFORE THE PUBLIC ACCOUNTS COMMITTEE 29 Oct 2012
“I suppose that the most important factor in determining public spending at any point at time is the level of spending in the previous period. I know that in one sense that is irritating and it would nice to be able to start with a clean slate, but at any point in time any service will largely comprise the staff who are delivering that service. Even if you wanted to cut health spending or local authority spending overnight, you cannot, because of the contractual rights of the staff who work in those services. There is a broader point there in that, for a given level of staff, unless you are prepared to enact legislation to reduce their wages in nominal terms, you cannot actually reduce the wage bill overnight. Governments have cut wages-they did it in the 1930s-but it has been striking that successive recent Governments have been reluctant to do that. In one sense, you are a prisoner of the baseline.
At the margin, in seeking to set public spending, you can begin to turn the tanker round. This Government were elected on a programme of protecting large swathes of the public sector, so there was a commitment to ensure that health spending was maintained, at least in real terms, and there were commitments in relation to education, overseas aid and so on. Again, that constrains what you can do. You could say that you could change those commitments, but I am just an official and I have to work with the commitments that Governments give me.”
And much more.............
http://www.publications.parliament.uk/pa/cm201213/cmselect/cmpubacc/c661-i/c66101.htmCorrected EvidenceUSE OF THE TRANSCRIPT
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