Police the big winners from the spending review

Richard Garside
Wednesday, 20 October 2010

Following today’s spending review many questions remain unanswered. How will the probation service manage on what will probably be a radically reduced budget? What will be the impact of legal aid cuts, or court closures? Are real reductions in the UK’s prison population on the cards? Or will the government merely attempt to manage more efficiently the historically high levels bequeathed to them by Labour? The latter I suspect.

What is clear is that the police are the big winners from today’s announcement. This might seem like an odd claim to make. According to the spending review documents the police face a 14 percent real terms cut to their budgets by 2014-15. But there are layers of complexity here that need unpacking.

First of all, consider the police budget against the background of the spending review cuts as a whole. The chancellor George Osborne told the House of Commons today that the overall cut in government spending would amount to 19 percent over the next four years. The Home Office is an overall loser. It faces an above average 23 percent cut to its resource budget over the same period. With only 14 percent of cuts, however, the police have done relatively well. They face smaller cuts than the Home Office budget as a whole, as well as below average cuts in comparison with the national picture. To balance this, the Home Office is having to make disproportionate cuts in other areas. As the Spending Review report makes clear, the Home Office settlement includes:

'overall resource savings for the Home Office of 23 percent in real terms by 2014-15, including through reducing consultancy spend, overheads and the size of the workforce; and reprioritising resources to front line. This also includes 30 percent real terms savings to the department’s non-policing funding.'

Few will be those who argue against reduced consultancy spend. But the Home Office will be taking an axe to a number of spending areas to protect the police budget.

Second, the police derive their income from a complex web of funding streams, local and national. In 2008/09, as a report on police expenditure by the Centre for Crime and Justice Studies showed, some £5 billion in police funding came from the Home Office block grant, the so-called ‘Revenue Support Grant’. But this only made up 36 percent of total police expenditure in that year. The next largest contribution came from the council tax (22 percent) and business rates (also 22 percent). Ten years earlier the Revenue Support Grant made up 49 percent of police expenditure, with council tax and business rates making up 14 percent each. Police expenditure has become more localised, and less dependent on central government over the past decade. The police have also become more adept at generating income from their own activities. In 1998/99 they generated just under £0.4 billion in this way. By 2008/09 this had grown to £1 billion.

The police are therefore in a much better position to weather central government budget cuts than a number of other criminal justice agencies. They also remain a powerful lobbying body. If they can persuade local government to chip in more funding in the future, and continue to bargain hard with the Home Secretary, they might get through the period of budget austerity largely unscathed.