Rounding up

Putting the 2019 Spending Round into context

In his September 2019 Spending Round the Chancellor rightly declared he was “turning the page” on austerity and “writing a new chapter in our public services”. But he has also ripped up his own fiscal rulebook, almost certainly breaking the fiscal ‘mandate’ in the near-term and casting significant doubt over his ability to keep debt falling as a share of GDP over the coming years.

By setting out plans for a £13.8 billion or 4.1 per cent real-terms year-on-year increase in day-to-day departmental spending in 2020-21, he has certainly brought the austerity era for public services to a close. This is the biggest increase in a spending review since 2002, ensuring that no departmental budget in Whitehall will fall next year and most will experience significant real-terms increases.