M-RCBG Associate Working Paper No. 113

The Political Economy of Public Spending Reviews: The UK Experience Since 1997

Ed Balls



A finance ministry-led public spending review sounds a quintessentially technocratic exercise: an opportunity to make sure that existing public service budgets are being spent as efficiently as possible; the chance to test whether public spending objectives are properly articulated and capture what the Government is trying to achieve; and a time to ensure that the allocation of public resources reflects those objectives.

This paper, drawing upon the UK experience of regular public spending reviews under the Prime Ministerships of Tony Blair and Gordon Brown between 1997-2010, argues that the opposite is the case. While these important activities should and do grab the attention and enthusiasm of career civil servants, the success of a spending review is vitally dependent on whether the politicians are properly engaged from the outset and throughout the spending review. In New Labour's thirteen years in Government from 1997, it was certainly the case that spending reviews were politically led from the outset. This paper outlines the lessons learned in the UK over that period, which will be useful to governments in other countries as they plan public spending reviews for the future.

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