Economics of the police: recruitment, retention and finance

Date: 01 August 2017
Contacts: Rowena Crawford , Richard Disney and Polly Simpson

IFS researchers have recently concluded a two-year ESRC-funded research project which analysed three broad areas of policing: recruitment, retention and finance. The researchers obtained access to innovative data sets and have presented their findings at academic conferences and in meetings with the Home Office, the Police Foundation and the College of Policing, amongst others. This work has gained extensive press attention, contributing to ongoing political debate and policy development.

Research background and aims

Police spending is a significant component of public spending, around 4% of centrally managed public spending. However, since 2010, police budgets have fallen in real terms and police forces have become more dependent on funds raised from local sources via the council tax. The trends in police numbers and police budgets, and the quality and deployment of the police workforce, became major political issues during the 2017 general election campaign.

This IFS research focused on three broad areas of policing. First, Rowena Crawford and Professor Richard Disney set out to analyse the quality of police officer recruits using an innovative data set obtained from the College of Policing, containing test scores of applicants to the police over several years. The data on applicant quality was matched to areas and used to examine how local characteristics – such as wages in alternative occupations, house prices and types of crime – affected the quality of police applicants.

Second, the research team explored the determinants of the retention rates of police officers using data from the Home Office and other sources. This built on existing published work by IFS researchers (Crawford and Disney, Journal of Public Economics, 2014).

The third area of interest concerned scope for local discretion over police spending arising from the capacity of local police authorities (now Police and Crime Commissioners, PCCs) to raise finance from the local ‘police precept’, levied in conjunction with council tax. This source of finance has become increasingly important to police forces relative to funding from central grants.

Key findings

The research found that the quality of police officer recruits varied across police forces and over time. National wage setting implies that relative wages between the police and other occupations vary spatially. We show that higher outside wages relative to police wages are associated with lower quality applicants, using several spatially-varying measures of outside wages and scores of individual applicants on the various tests administered to determine their capabilities. Second, nationally-set wages cannot adjust to reflect spatial variation in the disamenity of an occupation. Such disamenities might include variations in the amount of crime, in the type of crime (especially violent crime), and in workload that may deter some applicants such as women and graduates (who typically do well in police recruitment tests). The findings demonstrated that a greater disamenity of policing (as measured primarily by area differences in crime rates per police force member and in the proportion of crime that is violent) is also associated with lower quality police applicants.

In terms of retention, police force numbers are driven primarily by changing entry rates, not exit rates, because of the police pension system and the absence of a contract of employment for police officers which implies that police officers cannot be made redundant. Nevertheless, the research found some variation in leaving rates across police forces, again related to the availability and relative attractiveness of pay in alternative occupations.

The research findings addressed local discretion over spending on police officers. IFS researchers showed that variation in the level of the police precept over time and across police forces can be explained by ‘economic factors’ such as local real income and the real tax price of raising the precept. A forthcoming paper will describe these results in greater detail and also provide some preliminary evidence on whether greater local funding relative to central grants has any impact on measured police efficiency.

Research impact

Results from the research project as whole have been presented at numerous academic conferences, including the Royal Economic Society Annual Conference, the European Economic Association and the International Institute of Public Finance. There has also been direct contact with government and other organisations by researchers involved in police policy-making including the Home Office, the College of Policing, the Police Foundation, the Office of Manpower Economics and CIPFA. Rowena Crawford has spoken to a committee of Police and Crime Commissioners on changes to police funding. Richard Disney is currently a member of a Home Office Steering Committee which has been considering reforms to police funding.  The 2017 General Election Briefing Note on police numbers, funding and outcomes over the last decade was noted, although not always read carefully, during debates concerning public safety and police numbers.

The work on police recruitment was presented and discussed not just in academic settings but at the Home Office, the College of Policing and others. As the project was continuing, the College of Policing announced that it would improve recruit quality by changing professional requirements for applicants and the Police Review Body was tasked with examining the case for police wage variation across local areas. The change in recruitment standards broadly accords with the finding of the research as to which types of applicants perform better in entry tests; however the IFS research also suggests that it will be harder to recruit higher quality officers and staff in some areas than others. The research suggests that police wages can indeed be targeted more closely on local pay differences; however it also shows that pay is only one facet in determining the quality of applicants to individual police forces.  The work on police funding, and in particular on the role of the locally-raised ‘police precept’, has been presented at the Home Office against an ongoing process of attempting to reform the allocation of police finances across police forces in England and Wales by the UK government.

Relevant publications

‘Wage regulation and the quality of police office recruits’, Rowena Crawford and Richard Disney, IFS Working Paper W15/19, August 2015,

 ‘Police officer retention in England and Wales’, Rowena Crawford, Richard Disney and Polly Simpson, IFS Briefing Note BN191, January 2017,

 ‘Funding the thin blue line’, Rowena Crawford, Richard Disney and David Innes, Observation, November 2016,

‘Police workforce and funding in England and Wales’, Richard Disney and Polly Simpson, IFS Briefing Note BN208, May 2017,