Even the small cuts will have a big impact

With child trust funds and university spending dominating, the full scale of the Coalition Government's cuts and exactly where they will fall remain to be seen.

Though most of the headlines have been about the scrapping of the child trust fund and the reduction in the number of university places, the full scale of the Coalition Government’s cuts and exactly where they will fall remains to be seen. Also missing from much of the headline reaction is a detailed look at the departments which will ‘only’ have to make ‘modest’ savings this year.

The department for culture, media and sport will have to find £61 million of savings, plus £27 million from the Olympic Delivery Authority – a cut of 3 per cent of the overall budget; this compares to cuts of £836m in BIS, £780m at DCLG, £683m for transport and £670m in education.

Yet it is in the smaller departments that the impact of the cuts on communities can be best seen. Taking DCMS as an example, planned spending on administration for 2010/11 is only £46 million – so the savings could never be made up by axing Whitehall ‘pen pushers’ alone.

So what does it mean in practice? Guardian Online has this afternoon worked out what it may mean to arts funding, concluding that the arts are being “singled out”: the Arts Council England (ACE) will suffer a 4% cut on top of a planned spending review, with the chair of the ACE, Dame Liz Forgan, stating the council “do not understand why we have received a higher percentage cut than other DCMS funded bodies”.

She added:

“Making cuts within the financial year is very difficult. We will now need to carefully assess what this figure of £19m means. The Arts Council has already trimmed its own budgets by £4 million in 2010/11 so this takes our total reduction this year to £23 million.

“We will do our utmost to minimise the impact on the frontline but we cannot guarantee that there will be no effect. Only £23m (5%) of our overall grant-in-aid budget goes on running costs so the vast bulk of our income goes straight to art. It would therefore be impossible to meet a cut of this size from running costs alone.”

In sport, the other primary remit of the department, the picture is little better. In addition to the £27 million reduction in the Olympic Delivery Authority (ODA) budget – which is responsible for developing and building the new venues and infrastructure for the Games and their use after 2012 – 3% savings will have to be found across the board, from public bodies and the department’s core budget.

An example of what this may mean on the ground can be seen in the cuts that may have to be made to Sport Unlimited, a £36 million programme established in 2009 with the aim of attracting 900,000 extra young people into sport by 2011; a 3% cut could result in 27,000 fewer young people taking up sport, to the detriment of the nation’s sporting success and health and wellbeing.

The cut to the ODA budget could have an equally negative impact. According the the latest DCMS annual report:

“Over 4,000 people are working for contractors on the Olympic Park, 9 per cent of whom were previously unemployed – Nearly one in ten workers on the Olympic Park are doing a traineeship, apprenticeship or work placement – 98 per cent of contracts have gone to UK-based businesses, of which over two-thirds are Small and Medium-sized Enterprises and just under half are based outside London.”

ODA chairman John Armitt, howeverm insists the cuts are manageable and the project remains “on track”. He said:

“This saving will be found by continuing to make efficiencies in the way the project is delivered as we have already done in the past. Our regular budget updates have consistently shown that we are on schedule and within budget with savings of around 600 million pounds already delivered to keep us on track.”

It is to be hoped he is right; an immediate 3% cut in a project which has only two years left to run, with the potential job losses and externalities, and the eyes of the world upon following the gold-spinning success of Beijing makes little sense otherwise.

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37 Responses to “Even the small cuts will have a big impact”

  1. Alison Charlton

    RT @leftfootfwd: Even the small cuts will have a big impact: http://bit.ly/9Emmmw

  2. Shamik Das

    Analysis of #ConDemNation cuts on sport & the arts: RT @leftfootfwd: Even the small cuts will have a big impact: http://bit.ly/9Emmmw

  3. Nishma Doshi

    Public spending = healthy long-term economy. Cuts = short term solutions carrying long-term disaster! http://bit.ly/9Emmmw #noshock

  4. SadButMadLad

    It’s not just the pen pushers. When government departments spend £10.55 on a pack of 12 postit notes which can be bought by a normal person for £1.75 you can see that there is some serious savings to be made.

    http://www.nao.org.uk/idoc.ashx?docId=6B6A1636-4562-463C-B3E3-EF8C489F7DB6&version=-1

    Because of PFI government departments have to spend stupid amounts for silly little things, such as £150 to install a simple sliding bolt on a door. Is that good use of tax payers money?

    http://www.timesonline.co.uk/tol/news/politics/article7134040.ece

  5. Martin Johnston

    RT @leftfootfwd: Even the small cuts will have a big impact: http://bit.ly/9Emmmw

  6. Boudicca

    Perhaps, if you’re so worried about the idea of spending cuts, Labour shouldn’t have bankrupted the country and spent billions in a desperate attempt to get re-elected. Liam Byrne wrote to his successor ‘sorry, but there’s no money left – good luck.’ It may have been meant for the new Minister, but it might as well have been written to the whole country. It is LABOUR’S fault that the Child Trust Fund has been cut and Labour’s fault that we are going to have severe cut-backs in public spending for years to come.

  7. ikeaddy

    Surely the accusation made by Boudicca that Labour bankrupted the country is crazy. By the estimates I read, the 2008 bank bale out cost the taxayer at least £500 billion. I feel anger and resentment towards those same bankers who are probably laughing into their champagne flutes as the new Government forces cuts on public sector workers who are not to blame for the financial mess we are in. And if I hear another well paid journo describe the pain “we” must all go through I’ll go mad!

  8. Robert Bellamy

    Even the small cuts will have a big impact | Left Foot Forward http://bit.ly/aFNVVu

  9. Anon E Mouse

    Boudicca – Everybody knows that Labour governments are financially reckless and this is just the aftermath of believing the worst chancellor in British history – the unelected Gordon Brown.

    The Child Trust Fund was a lunatic idea anyway. Imagine borrowing money on the international markets (or taking it from taxpayers) to give to babies whilst all the time having to pay interest on the very money you’ve given to a non productive member of society – a baby. Why did we ever put up with it?

    It really was an act of madness and at the next election Labour will pay for the state they’ve left the country in big time.

    Every time blogs like this one bleat on about how bad the cuts are weeping and wailing it will simply remind the electorate who left us in this mess and Labour still haven’t learned. Yesterday Alistair Darling was moaning about cutting government waste too early. Government waste can NEVER be cut too early – it doesn’t take a financial genius to work that one out….

  10. Liz McShane

    Anon – what other socially progressive benefits would you like to see slashed?

    You & Boudicca seem to forget that if if wasn’t for Labour’s deft handling of the effect of the global economic crisis that faced us we would really be up the creak without a paddle. Many ‘developed’ economies followed Labour’s brave & bold lead to nationalise problem banks.

    The Tories were against this and if we had followed their half-baked ideas we would be facing a 1930s type depression. That is why a lot of City folk just dread George Gideon Osborne – because he hasn’t a clue.

  11. Anon E Mouse

    Liz – Please don’t pursue this line – it makes you look mad woman!! We ARE up that creek already; thanks Gordon.

    “Labour’s deft handling of the economy” is as bonkers a remark as “Gordon Brown’s masterful handling of the economy” – both are examples of how financially reckless and incompetent the last government was – the current overdraft shows it – the proof of the pudding is clear to see.

    Britain’s debt of £890 billion is an all-time high, while the last financial year’s borrowing of £163 billion was another record – on top of that Brown said we would lead the G20 out of recession – wrong again; we were last.

    Labour have spent 13 years wasting our money on stupid things like Child Trust Funds with a complete disregard to the truth – Brown did not end boom and bust and I’m afraid that no matter how often you say it Liz look at the structural debt then you realise that Labour was hopeless with finances – the numbers prove it.

    Lastly why on earth are you defending Labours record with the countries economy when the governor of the Bank Of England (appointed by Brown btw) says the coalition is right to cut wasteful spending immediately? Why wouldn’t someone cut waste – your position is incredible Liz. Sorry.

    What is it that you know Liz that the markets don’t because they jumped as soon as the coalition between Conservatives and the Liberals was announced and surely you can’t be so cold hearted to not agree that this government is SO much better than the serious boring Stalinist bunch the electorate just got rid of…

    Lighten up Liz for goodness sake!

  12. Liz McShane

    Anon – you Lighten up – I really wish U could. I agree I am not a trained economist, but IF GB etc hadn’t taken the steps they took re the banking crisis than we would be in a much worse/dire state.

    I am not one of these people who think that the public finances and Gov’t handling of them can be simplistically compared to domestic household’s management of their credit cards etc. That was what George Gideon tried to make us think.

    I suppose we have different views of economics…. and I prefer the Keynesian variety and I can see that this is not quite to your taste.

    There are still 2 more announcements to come re cost cutting…. the first one was just an aperitif to whet the palette.

    All I would say is brace yourself James!

  13. Shamik Das

    “Liz – Please don’t pursue this line – it makes you look mad woman!!”

    De-lightful. Lovely tone, nice of you to show your true colours again.

  14. Mr. Sensible

    Liz, do you agree with me that, if we cannot afford to keep our public services as they are, we cannot afford the Tories’ pet projects?

    Do you agree with me that, for example, if we cannot afford the Child Trust Funds, we cannot afford to promote 1 type of family over another through the tax and benefits system?

    Similarly, if we cannot afford to keep BSF, we cannot afford to extend ocadomies.

    I’m not sure what part of the country you are in, but here in Nottinghamshire we’ve had this for about a year; Tories saying we’re broke ETC yet among other things finding the £9 million necesary to freeze council tax.

  15. Anon E Mouse

    Liz – I am basking in the glory of being proved right about the last Labour government and I actually think there will be a change in this country once Nick Clegg has repealed lot’s of stupid Labour laws, ID cards and the like.

    I also like the fact that (unlike Brown who abolished the 10p tax and punished the poor directly) Clegg is trying to help the poor with the tax allowances.

    I hate to say it but I’m beginning to like Clegg (still don’t like Cameron though!) and if this coalition succeeds and Labour members are stupid enough to vote for Ed Balls or Ed Miliband then as a party there will be no point of Labour anymore.

    And the reasons for the cost cutting is Labour’s debts…

    Shamik – The exclamation marks at the end indicate light hearted irony…

  16. Liz McShane

    Anon – please indulge me – apart from from the 2 Eds, who would you vote/prefer as next Labour leader, it sounds like you are still interested in the future of the party or maybe that’s just a mad thought….

    Mr S – 110% in agreement.

  17. Anon E Mouse

    Liz – David Miliband ARRRRGHHHHHH I said it.

    I’ve changed my opinion of him completely after seeing him during the election on the Politics Show – he was good natured and light hearted and funny. When I remember how badly Wheelan and the other Brown thugs treated him I think he’s the man.

    He could make Labour electable and even though they’ve lost my vote we do need an opposition in this country rather than the press…

    (I like Diane Abbott as well but she has no chance I feel)

  18. Liz McShane

    Anon,

    Firstly apologies: I meant to write: “Lighten up..? I wish I could” (rather than U lighten up… etc)

    Thanks for being so candid – so you really are torn between Old Labour & New Labour – that explains a lot, now I ‘get you’…!!

  19. manishta sunnia

    Even small cuts will have a big impact @NishmaDoshi #noshock #nocuts http://bit.ly/9Emmmw

  20. Liz McShane

    Anon – you should have been at Progress’s Annual Conference last Saturday. David Miliband was the keynote speaker!

  21. trevmax

    david miliband is the worst idea. we need someone on the left to open a discussion about what Labour is all about. David Miliband seems to be on the Blairite wing of the party and not a lot of difference between him, Cameron and Clegg. We at least need an opposition. There has to be a mainstream party arguing for government ownership of the major sections of the economy for example. What about unilateral nuclear disarmament? what about squeezing the rich ’til their pips squeak. The labour movement isn’t only about the Blair/Brown years.

  22. Liz McShane

    Trevmax – I understand your concerns but the bottom line is we need a leader that can get Labour re-elected and take us back into Government (for all the right reasons & with progressive policies) – we don want to be in opposition for 2-3 terms so we need to think carefully about what we decide Labour stands for, how we articulate this and how it resonates with the great British public.

  23. Anon E Mouse

    Liz – I told you before I wouldn’t be deliberately offensive. Obviously I like to rant but I do that in life generally as well.

    The reason for David Miliband is I see him as similar to Cameron and Clegg and the public would never vote for his brother Ed – the guy’s just too odd and being the minister for climate change is a poisoned chalice.

    trevmax – I agree but his similarity will appeal to people and the country is moving rightwards like most of Europe… I also think there should be an idealogical difference between parties to give the public real choice.

    This coalition does feel different – I would normally say it doesn’t matter who you vote for the government always gets in.

  24. Liz McShane

    Anon – Personally – I think Ed might have the slight edge in being viewed more ‘human’ by the wider electorate and therefore will be able to ‘connect’ with them better.
    No offence taken….. I can see you like to rant at times (who doesn’t) – as they say better in than out!

  25. trevmax

    @liz

    i thought labour stood for government ownership of the major sections of the economy, unilateral nuclear disarmament, squeezing the rich ’til their pips squeak’. they always did. i thought the last 13 years was an aberration which was about getting into power. i mean there’s no point being elected if you have to throw all your principles away to do it. if you support david miliband, why not just join the lib dems and be in government now?

  26. trevmax

    @ liz and anon

    so what does the labour party either stand or want to stand for? Blair/Milliband was liberalism wasn’t it? free markets? not free markets? fact is i don’t know. when i used to vote labour back before 1997 at least i thought i knew, now i don’t have a clue. the fact is labour (like the other parties) is a broad church and that includes some of the old Bennite left and the Blairite right, but you have to pick a direction and I don’t think Blairite right would really give the current coalition an opposition.

    can you think of a policy that would even make labour stand out from the coalition apart from ‘massive cuts but wait a while’

  27. Liz McShane

    TrevMaxx – I don’t think I actually said that I support David Miliband…. I don’t think there’s much point or fun being in opposition. Do you not think that the Labour Government introduced any progressive policies in the last 13 years?.. what about The Minimum Wage, Family Tax Credits etc..

    I agree they could/should have done more & been bolder and not done some of the things that they did (10p tax rate, Iraq etc).

    While Nuclear Disarmament may be important & valid to some it doesn’t get that many votes on the doorstep. I think we need to be pragmatic as well as progressive & bold.

  28. trevmax

    liz, you seem only to be interested in power rather than principles. i never voted for labour from Blair onwards because it was fundamentally dishonest. the removal of clause 4 was about power not because that was believed to be the right thing. i could vote for old labour but not new. that’s why there needs to be a debate and i don’t see one. your argument seems to be about what gets votes or gets labour back into power.

    what do you mean when you say they should have been bolder? what do you actually think about nuclear disarmament? i don’t doubt labour did some good but it’s rather counterbalanced by being in the fiscal situation we’re in. like a bank robber giving money to charity.

  29. trevmax

    and it was not just Iraq that was a mistake. we had 10 years of constant warmongering. i thought the Cons were supposed to be Imperialist like that but what did we have?, a small, short, defensive war over the falklands and a multilateral war to eject Saddam from Kuwait. The records couldn’t be more different.

    as for work and welfare, we have 5.5 million watching Jeremy Kyle. unchanged from 1997. wtf was that all about?

    difference between rich and poor never greater. banks lauded for their wonderful contribution to the ‘bubble’.

    i’d like a discussion about the achievements and minimum wage was one. tax credits wasn’t because it was borrowed off future generations.

  30. Liz McShane

    TrevMaxx – I am interested in principles & making sure we have progressive & fair policies. But how can we make society & people’s lives better by being in opposition? We need policies that resonate with the majority of people (by that I mean the Centre-Left)

    In principle I am for Nuclear Disarmanent, but on a practical level it’s not top of my list of priorities to be honest.

    Re the Fiscal situation – yes we should have had tighter regulation vis a vis the banks and I think the current group of leadership candidates are all in agreement that we need to take more of a firm control of the markets and not to be slaves to them – as we know markets do not have any moral conscience.

    I was quite horrified to hear from a previous Gov’t minister (speaking at a fundraising event earlier this year) that when Labour came in to power in 1997 some state primary schools still had outside loos. That’s an utter disgrace for a so-called civilised & modern society.

    I think we forget all too easily the social progress that has been made since then and it’s so much easier to dwell on the negatives and some fond, romantic notion of what might have been.

  31. trevmax

    your primary school indoor loos were bought on tick and will be payed off over 40 years.

    re being slaves to the markets, when you borrow £156 billion a year off them, they OWN you.

  32. trevmax

    “policies that resonate with the majority of people (by that I mean the Centre-Left)”

    look at the readership of the various papers. the majority is not centre-left.

    what people need is a choice and old Labour was that choice on the left. David Miliband is most definitely not

  33. Liz McShane

    Well Old Labour didn’t win any elections when we needed Labour in Government and we had 18 years of Thatcherism instead…….

  34. Liz McShane

    I meant to write 18 years of Tory rule inc 13 years of Thatcher…

  35. trevmax

    how many people were killed by an imperialistic warmongering UK in 18 years of Cons? How many under 13 years of labour? I voted Labour before Blair. If I’d have voted for Blair I would not be able to sleep at night. There is blood on your hands and the hands of all labour voters.

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