Can we measure the distributional impact of changes to spending on public services?

Date: 04 November 2011
Contacts: Haroon Chowdry , Ian Preston , Cormac O'Dea and Paul Johnson
The ongoing fiscal consolidation relies heavily on reductions to spending on public services. This presents new challenges for researchers interested in assessing the distributional impacts of government activity. While there is an established methodology for measuring the distributional impact of changes to taxation and to the levels of cash benefits, there is no established methodology for doing so when the changes are in spending on services that are provided in kind (health, education etc.). IFS researchers have investigated the issues involved and produced a number of publications outlining how and when one can assess the impact of these changes in spending. In addition to presenting this work to academics, the researchers involved have had numerous discussions with journalists, civil servants and other researchers and have established themselves as some of the leading authorities in the UK on this issue.