What is a Spending Review? How will it affect you?

On Wednesday the government will announce how much money it will spend on hospitals, schools and other public services over the next financial year, starting in April 2021.

This process, known as a Spending Review, will also include details of how the government plans to deliver on some of the promises it made during the last election campaign, such as improving the economy of less wealthy areas of the UK.

We will also get more detail about how badly Covid-19 has affected the economy.

The pandemic has brought tens of billions of pounds of extra costs, and cut the amount of tax coming in to pay for them.

So the Chancellor, Rishi Sunak, who conducts the Spending Review, has some uniquely difficult decisions to make.

A Spending Review determines how much gets spent on public services.

So anyone who ever visits a GP or an NHS hospital, or goes to school, or uses roads or any of the other services provided by government will be directly affected.

More money for the NHS should mean better treatment, delivered quicker.

The Spending Review is also expected to include details of how big a pay increase public sector workers such as nurses, police officers and teachers will get next year. It is possible many of them will not get a raise at all.

If the Spending Review helps government deliver its plan to bring greater prosperity to places such as the north of England, it should make life better for people who live there.

And the chancellor’s decisions will affect how much the government borrows next year, and in future years. And the cost of paying back those debts, or at least paying the interest on them, will fall on future tax payers for years to come.

Usually a Spending Review would cover a period of three or four years to give government departments enough certainty to make long-term plans.

The coronavirus pandemic disrupted so many aspects of life this year that long-term planning is particularly difficult.

So the government has decided that this Spending Review will only cover one year, from April 2021 to April 2022.

Normally the amount of money a Chancellor would allocate in a Spending Review would be strictly limited by how much he or she would be prepared for the government to borrow.

But this year the pandemic has caused government borrowing to skyrocket.

With businesses closed and workers on furlough, government is taking less money in taxes. And it’s spending more than planned on measures to fight the virus and support the economy.

Before the pandemic, the government expected to borrow around £55bn this financial year.

Seven months in, the government has already borrowed £215bn, and it’s expected to exceed £370bn by the end of the year.

The government can’t keep borrowing that amount of money for very long.

So the chancellor must decide whether to prioritise cutting the amount the government has to borrow – which would mean spending less money on public services.

Alternatively he may decide that it’s worth borrowing even more money to fund the NHS and support the economy.

From 2010 to 2019, the amount of money spent on public services has been falling – the longest sustained fall on record, according to the Institute for Fiscal Studies think-tank.

Before the pandemic struck, government had already made plans to bring that squeeze to an end, increasing spending this year and next.

It was planning an increase of 4.4% in day-to-day departmental budgets for 2021-22.

The amount available to departments for longer-term investment was set to grow even faster, by 12.5%.

The pandemic forced the government to spend tens of billions extra on health, and supporting jobs and the economy.

It is likely to have to spend more than it planned next year, too.

Some elements of the Spending Review have already been announced:

The Spending Review may also give more detail on how the government plans to meet its other long-term goals.

The government hopes to improve the economy in poorer areas of the UK, known as “levelling up”. It has also set out plans to fight climate change by cutting the UK’s carbon dioxide emissions to net zero by 2050.

The chancellor may also need to set aside money for new arrangements for when the UK is no longer bound by EU rules in the new year – such as more customs agents.

The Spending Review this year will also see the release of a new set of economic forecasts from the Office for Budget Responsibility, which keeps tabs on government spending.

These forecasts will estimate how much damage the pandemic has done to the economy, how quickly it is likely to recover, and how many people will lose their jobs.

They will also predict how tax will be raised, and how much the government will have to borrow in future years.

The numbers will reflect that 2020 saw one of the most severe recessions on record.

That will present the chancellor with a stark choice in coming years – cut spending, raise taxes, or allow government to keep on borrowing.

How does the Spending Review affect Northern Ireland, Scotland and Wales?

Many parts of the Spending Review will only apply to England.

Much of government activity elsewhere in the UK is controlled by the devolved administrations – the Scottish government, Welsh government and Northern Ireland Executive.

If the chancellor spends extra money on a service which is covered by devolution, such as education, the devolved administrations get extra money too.

The idea is that a £100 increase in spending per person in England on education, should be matched with an extra £100 per person for each of the devolved administrations to spend as they choose.

The way money gets allocated is set out by the Barnett formula, named after Lord Barnett, the politician who devised it in the late 1970s.

Rishi Sunak says Spending Review will not spell austerity

Rishi Sunak has said people “will not see austerity” when he makes spending announcements for public services this week, despite the billions spent on the pandemic response.

The government has indicated it will keep to past promises when allocating funds for policing, nurses and schools.

On Wednesday the chancellor will detail the Spending Review.

It will outline how taxpayers’ money will be spent on departments such as health and education.

But while ruling out a return to austerity, Mr Sunak has also warned people will soon see an “economic shock laid bare”.

He told the BBC’s Andrew Marr show that record government borrowing to deal with the coronavirus must be “grappled with”.

That suggests tax rises or spending cuts could be further down the road. The Spending Review will give a clearer picture of the economic damage wrought by the pandemic so far.

Last week, reports that Mr Sunak would freeze wages for public sector staff were met with fierce criticism from unions and workers, though NHS frontline staff are likely to be excluded from such a move.

Speaking on Sky’s Sophy Ridge On Sunday, the chancellor said: “You will not see austerity next week, what you will see is an increase in government spending, on day-to-day public services, quite a significant one coming on the increase we had last year.”

But, while he said that he “cannot comment on future pay policy”, Mr Sunak added: “When we think about public pay settlements, I think it would be entirely reasonable to think of those in the context of the wider economic climate.”

It is thought the chancellor is keen to freeze public sector pay since average private sector earnings have fallen this year.

On Monday, the shadow chancellor Anneliese Dodds will give a speech which argues that: “Freezing the pay of firefighters, hospital porters and teaching assistants will make them worried about making ends meet ahead of Christmas – that means they’ll cut back on spending and our economy won’t recover as quickly.”

Labour is calling on the government to bring forward £30bn in capital spending over the next 18 months to create new jobs.

Prior spending commitments made by the government include the hiring of 50,000 more nurses, and 20,000 extra police officers by 2023.

However, the BBC’s Reality Check team points out that while 30,000 new nurses will be trained locally or recruited from overseas, 20,000 of the 50,000 roles announced will be existing nurses persuaded to stay in the profession.

The Reality Check team also points out that adding 20,000 police officers will return total staffing levels to the 143,000 police officers employed prior to the 2010 election when the Conservatives came to power.

The government has also promised to increase spending on schools by £2.2bn in the 2021-2022 financial year, and direct £1.5bn towards building works at Further Education colleges.

The Treasury announced on Sunday that another £1.25bn will be allocated to the prisons service.

The government says a total of £4bn will be allocated to build more than 18,000 additional prison places across England and Wales over the next four years. Some 10,000 of these places have been planned since 2015.

Mr Sunak said: “This has been a tough year for us all. But we won’t let it get in the way of delivering on our promises – the British people deserve outstanding public services, and we remain committed to delivering their priorities as we put our public services at the heart of our economic renewal.”

Covid: Gyms and all shops to reopen after English lockdown

Gyms and non-essential shops in all areas are expected to be allowed to reopen when England’s lockdown ends.

Prime Minister Boris Johnson will on Monday explain the detail of England’s return to the “three tier system” when lockdown ends on 2 December.

While parts of the tier system will be toughened, the 10pm closing time for pubs and restaurants will be relaxed, alongside gyms and shops reopening.

And mass testing will be introduced in all tier three areas, the PM will say.

Mr Johnson will say rapid testing with military support, as used in Liverpool, will form part of the stricter system.

He is expected to tell MPs that it will “help get the virus back under control and keep it there”.

More areas are set to be placed in the higher tiers after lockdown, No 10 has said. Details of which tier every region of England will be put into are expected on Thursday.

Under the new plans, last orders in pubs and restaurants allowed top open will remain at 10pm, but customers will have an extra hour to drink up.

However, it has been reported that pubs in tier three will only be open for takeaway – while those in tier two must serve substantial meals, even to outdoor customers.

The PM had hoped to announce arrangements for the Christmas period on Monday, but this has been delayed until at least Tuesday to allow the Scottish and Welsh cabinets to agree the plans.

It comes after the government said the UK’s four nations had backed plans to allow some household mixing “for a small number of days” over Christmas.

One option that was discussed in meetings this weekend was that three households could be allowed to meet up for up to five days, according to the BBC’s deputy political editor Vicki Young.

Pre-lockdown, there were three tiers of restrictions – medium, high, and very high:

The plan for extensive community testing in areas on the “very high” alert level follows a pilot programme in Liverpool, where more than 200,000 people were tested and which the government said contributed to the fall in cases there.

Repeat testing will also be offered so that the close contacts of confirmed cases may not have to self-isolate.

Instead, they will be able to take a test every day for a week and will only need to isolate if they test positive.

Repeat testing is due to be trialled in Liverpool on Monday. If it is considered successful, it will be expanded to care homes and the NHS in December, and to the general public in January.

Mass testing in tier three areas, which will use the 30-minute lateral flow tests deployed in Liverpool, is intended to offer communities a way out of the highest level of restrictions.

Mr Johnson is expected to tell the House of Commons: “The selflessness of people in following the rules is making a difference.”

The increase in new cases is “flattening off” in England following the introduction of the nationwide lockdown measures, he will say.

The prime minister will say “we are not out of the woods yet”, with the virus still present in communities across the country and remaining “both far more infectious and far more deadly than seasonal flu”.

“But with expansion in testing and vaccines edging closer to deployment, the regional tiered system will help get the virus back under control and keep it there,” he is due to say.

On Sunday, the UK recorded another 18,662 confirmed coronavirus cases and 398 deaths within 28 days of a positive test. The total includes 141 deaths which were omitted from the 21 November figures in error.

Mass rapid testing has already been extended to 67 areas in England and parts of Wales, but Downing Street said the government would now offer many more tests with additional logistics support for every area in tier three.

In Liverpool, Public Health England said the tests found an extra 700 people who had the virus without any symptoms and who may not have been detected otherwise.

Downing Street also said weekly testing would be expanded to all staff working in food manufacturing, prisons and the vaccine programme from next month.

While some measures are expected to remain the same as those in the previous three-tier system, others are expected to be strengthened to protect the progress made during lockdown.

Twelve schools to shut due to concern over Covid spread

Seven schools in the Cardigan area and five schools in north Pembrokeshire will shut from Monday due to Covid-19.

Ceredigion Council said it has become “increasingly concerned” about the spread of the virus in the area.

It said it believes “a number of super-spreader events” had led to evidence of more cases of community transmission.

The Cardigan schools will close for two weeks. It is not known for how long the schools in Pembrokeshire will be shut.

In a letter, Ceredigion Council said seven schools and two nurseries would be closed until 7 December and pupils will be taught remotely.

The affected schools include:

The Flying Start Nurseries in Cardigan and Aberporth will also shut, along with Cardigan library.

A number of businesses in the area have also said they will be closed due to the spread of cases.

In addition, Pembrokeshire Council confirmed five schools would close:

The authority was not yet able to tell the BBC when the sites would reopen.

Coronavirus: Twelve schools to shut for two weeks

Seven schools in the Cardigan area and five schools in north Pembrokeshire will shut from Monday due to Covid-19.

Ceredigion Council said it has become “increasingly concerned” about the spread of the virus in the area.

It said it believes “a number of super-spreader events” had led to evidence of more cases of community transmission.

The Cardigan schools will close for two weeks. It is not known for how long the schools in Pembrokeshire will be shut.

In a letter, Ceredigion Council said seven schools and two nurseries would be closed until 7 December and pupils will be taught remotely.

The affected schools include:

The Flying Start Nurseries in Cardigan and Aberporth will also shut, along with Cardigan library.

A number of businesses in the area have also said they will be closed due to the spread of cases.

In addition, Pembrokeshire Council confirmed five schools would close:

The authority was not yet able to tell the BBC when the sites would reopen.

Coronavirus: Seven Cardigan schools to shut for two weeks

Seven schools and two nurseries in the Cardigan area will shut for two weeks from Monday due to Covid-19.

Ceredigion Council said it has become “increasingly concerned” about the spread of the virus in the area.

The authority believes “a number of super-spreader events” had led to evidence of more cases of community transmission.

In a letter, it said the nine sites would be closed until 7 December and pupils will be taught remotely.

The affected school include:

The Flying Start Nurseries in Cardigan and Aberporth will also shut, along with Cardigan library.

A number of businesses in the area have also said they will also been closed due to the spread of cases.

Two men charged with Holyhead mans murder

Two men have been charged with the murder of a 58-year-old man from Holyhead.

David John Jones – known locally as DJ – died as a result of “extensive head injuries” in Royal Stoke University Hospital on Thursday, police said.

The two men, aged 47 and 38, both from Holyhead, will appear at Llandudno Magistrates’ Court on Monday.

North Wales Police is appealing for witnesses to an assault on Mr Jones on November 17 to come forward.

Officers have been granted a warrant of further detention at a special court in Mold for a woman also being held in connection with the death.

Det Ch Insp Brian Kearney said said: “Despite two individuals being charged, I would continue to appeal for any witnesses who saw the victim… between 10:00-11:00 GMT in Holyhead to come forward.

“Our thoughts remain with David’s family at this tragic time.”

Covid: Officer bitten breaking up illegal party

A police officer has been bitten on the arm while trying to break up a party in Manchester.

Greater Manchester Police (GMP) said it issued more than 80 fines after a number of gatherings breached coronavirus rules this weekend.

A person has been charged with assaulting an emergency worker after the party in Butterton Drive overnight.

Police also found more than 100 people at an event in an industrial unit in Mary Street on Saturday night.

After receiving a report of 10 people in the yard, officers arrived and heard more people inside.

After opening several locked doors, they found a large crowd inside the building.

A total of 17 people were given fixed penalty notices at the gathering, a police spokesperson said.

Since 2 November, more than 600 fines have been handed out by GMP over illegal gatherings.

Assistant Chief Constable Nick Bailey said: “The world is currently facing a public health crisis and breaking such regulations is simply against the law and selfish.

“I would also remind the public who choose to so obviously breach these rules, this is adding to the pressure on policing when we would much rather be responding to other calls from the public.”

Bike from Banksys Nottingham hula-hooping girl vanishes

A bicycle which formed part of Banksy’s hula-hooping girl artwork has gone missing.

The graffiti artist’s latest piece appeared on a residential street in Nottingham on 13 October.

It showed a girl hula-hooping with a tyre next to a bike missing its back wheel.

But the bicycle vanished from its post outside a beauty parlour in Rothesay Avenue over the weekend, which one visitor described as “such a shame”.

Resident Tracy Jayne found the artwork had been targeted when she went to visit it on Sunday morning.

“The artwork records an important part of Nottingham’s history, Raleigh bikes,” she said.

“My late husband worked for Raleigh until it closed in 2002. He died at age 48 in 2017.

“It’s such a shame that someone has stolen the bike. It’s sheer disrespect and saddens me very much. “

What happens when a Banksy appears?

Banksy’s work drew queues of sightseers when it was claimed by the artist’s Instagram feed and the reaction was overwhelmingly positive.

The council protected it with a transparent cover, but the artwork has been targeted with spray paint at least twice.

Both Nottinghamshire Police and Nottingham City Council said the removal of the bike had not been reported to them.

Banksy began spray-painting trains and walls in his home city of Bristol in the 1990s, and before long was leaving his artistic mark all over the world.

Covid-19: Christmas get-together plan backed by UK nations

The UK’s four nations have backed plans to allow households to meet “for a small number of days” over Christmas.

It comes as Boris Johnson is due to announce on Monday what Covid restrictions may be in place over the festive period.

The PM will also outline plans for a tougher three-tiered system for England – to be introduced at the end of the current lockdown on 2 December.

The 10pm curfew could be eased under the new system.

The Cabinet Office said ministers from England, Scotland, Wales and Northern Ireland have endorsed a “shared objective of facilitating some limited additional household bubbling for a small number of days”.

But, following talks on Saturday, they have emphasised that the public will be advised to “remain cautious”, and that “wherever possible people should avoid travelling and minimise social contact”.

Discussions are ongoing – including about travel arrangements – but it is hoped a deal can be reached this week.

In respect of Northern Ireland, ministers have also “recognised that people will want to see family and friends across the island of Ireland, and this is the subject of discussions with the Irish government”.

Under the plans for restrictions in England, more areas are set to be placed into the higher tiers to keep the virus under control, Downing Street said.

And some tiers will be strengthened to safeguard lockdown progress.

Some local measures will be the same as those in the previous three-tier system, which was in place in England until the current lockdown began.

Pre-lockdown, there were three tiers of restrictions – medium, high, and very high:

However, the government’s Scientific Advisory Group for Emergencies (Sage) is expected to publish research on Monday saying the previous restrictions were not strong enough.

The government will identify the tiers that each area will be placed into on Thursday.

But 70 Tory MPs have said they will not back the proposals without evidence.

In a letter to the prime minister, the recently-formed Covid Recovery Group (CRG) said it cannot support a tiered approach unless it sees evidence measures “will save more lives than they cost”.

MPs are expected to vote on the new tier system in the days before it comes into force.

Government ministers and advisers have been hinting about new tougher tiers over the past week.

Before lockdown there was some evidence that tiers two and three were having an impact, but not tier one.

Crucially, both the top two tiers involved banning mixing inside homes, so one option being discussed behind the scenes is introducing a ban across all the tiers until winter is over.

The exception will, of course, be Christmas.

That is a move that divides opinion. But the government sees it as a necessity, believing significant numbers of people will ignore any attempt to ban gatherings over the festive period.

It is also a recognition the public needs a break from the long hard slog of the pandemic.

Infection rates will of course rise, but that will be offset to some extent by a wider boost to wellbeing.

Chancellor Rishi Sunak told the BBC’s Andrew Marr the 10pm closing time for pubs and restaurants was one of the things that the government was looking to “refine”.

It is understood rules will be relaxed to give people an extra hour to finish their food and drinks after last orders at 10pm.

Kate Nicholls, chief executive of UK Hospitality, said this would help businesses – but would be “meaningless” unless people were allowed to socialise with friends and family, particularly over the crucial Christmas period.

Meanwhile, the Daily Telegraph reported that several families could be allowed to meet between 22 and 28 December for Christmas.

Ministers have made clear the festive season will be different to normal – with some restrictions expected to remain in place.

Labour has so far supported the need for restrictions to slow the spread of Covid-19, making a Commons defeat on the plan unlikely.

But shadow chancellor Anneliese Dodds told the BBC her party wanted clarity from the government over how tiers would be decided and the support available for businesses.

On Sunday, the UK recorded another 18,662 new coronavirus cases and 398 deaths within 28 days of a positive test, bringing the UK total to 55,024.

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