Facts and figures about UK taxes, benefits and public spending.
Income distribution, poverty and inequality.
Analysing government fiscal forecasts and tax and spending.
Analysis of the fiscal choices an independent Scotland would face.
Case studies that give a flavour of the areas where IFS research has an impact on society.
Reforming the tax system for the 21st century.
A peer-reviewed quarterly journal publishing articles by academics and practitioners.
Authors: Robert Chote and Carl Emmerson
The new coalition Government has announced a £6.2 billion headline cut to public spending in the current year. Since £500 million is being recycled into additional spending or tax cuts, and the £704 million earmarked for devolved administrations does not have to be found until next year, the likely reduction in borrowing in 2010-11 is around £5 billion. This is less than a tenth of the fiscal repair job that Alistair Darling's March 2010 Budget forecast suggested will be needed over the next few years.
Of the £5 billion reduction in borrowing £4.8 billion is to come from reduced spending by central government on public services and their administration (Departmental Expenditure Limits, DELs). The rest is from cuts to the Child Trust Fund, offset by a small cut in business rates. This is a fall in these budgets of 1.2% relative to the level departments were told they could budget for under the previous Labour Government's plans. Labour had planned to cut these budgets by 0.5% after economy-wide inflation between 2009-10 and 2010-11: the 1.2% cut in plans for 2010-11 announced today increases this cut to 1.7%.
As promised the new coalition Government is keeping to Labour's planned increases in spending in the NHS, MoD and overseas aid. In addition they have decided not to cut spending on schools, Sure Start and education for 16-19 year olds. Our calculations - largely based on spending figures made available from the Treasury -suggest that on average the areas of spending that have not been protected from cuts in today's announcement will see their budgets fall by an extra 3.7%. This brings the total cut in these areas relative those planned for last year up from 4.7% to 8.2%. (An earlier version of this observation contained slightly different numbers as it was produced before any figures were made available from the Treasury.)
The Table below shows our estimate of the cuts to each department as a share of the previous Labour Government's plans, and the change in budget compared to last year.
Note: Figures take account of increases in spending in the CLG Communities and the Business, Innovation and Skills departments. Chancellor's Departments ignores the cut to the Child Trust Fund.
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A give and take Autumn Statement?
The Autumn Statement is expected to contain a welcome upward revision to the forecast for economic growth this year and a welcome downward revision to the headline deficit. But any improvement will be small relative to the level of the deficit forecast in the Budget, and the deficit this year will still be very high by historical standards and relative to what was projected at the start of this Parliament and compared to what the Chancellor is ultimately hoping to achieve. So as the Chancellor George Osborne prepares for the Autumn Statement, if he is planning to make good on the promises of giveaways made during the party conference season he should also be considering new measures to pay for them.
Entry to grammar schools in England for disadvantaged children
New work by IFS researchers, funded by the Sutton Trust, suggests that grammar schools are disproportionately unlikely to admit students who are eligible for free school meals, even when conditioning on their academic performance in primary school. They are by contrast disproportionately likely to admit children who have attended private schools before age 11.
The crucial role of good evidence in evidence-based policymaking
In a time of continuing fiscal austerity, policymakers increasingly want to know ‘what works’ and for whom, in order to target scarce resources on those who will benefit most and to ensure that policy has the desired impact upon those it is designed for. Basing policy decisions on evidence is undoubtedly a good thing - but only if the evidence used is robust, unbiased and methodologically sound. This observation uses recent IFS work on the link between parents’ marital status and relationship stability and child development to illustrate the challenges of using research to inform policymaking.