Spending Review: Cuts watch, department-by-department

The coalition government has placed cutting the UK's record budget deficit at the heart of its economic policy, and on 20 October is setting out which government departments will be asked to cut their spending, and by how much. Check here for updates.

Business, Innovation and Skills

Department's key responsibilities: Business and enterprise support, running higher and further education, promoting scientific research and regional development

Annual budget: £21.2bn

Cut required to meet 25% savings target: £5.3bn

What's been cut so far: When the government announced its plans for Whitehall-wide savings of £6.2bn in May, the Department for Business, Innovation and Skills was told to make the biggest cut, totalling £836m. Of this, £100m was to come from running costs, £200m from making higher education more efficient and modernised. A further £74m was from the Regional Development Agencies' budget and £233m from the UK centre for medical research. The business department has also cancelled an £80m loan offered by Labour to Sheffield Forgemasters to allow the firm to build parts for nuclear power stations. Universities minister David Willetts has vowed to protect "blue skies" academic research but has said some of it, including the UK's network of 24 nanotech centres, could be centralised to save cash. Business Secretary Vince Cable has asked research scientists to do "more for less", signalling cuts to the sector. The government has accepted in principle Lord Browne's report calling for universities in England to be able to charge higher fees to make up for future shortfalls in funding.

Rumour mill: Press reports say up to 25% of staff could be laid off, but officials have said this is wide of the mark.

Cabinet Office

David Cameron and Nick Clegg

Department's key responsibilities: Co-ordinates much of the activity of central government

Annual budget: £2.6bn

Cut required to meet 25% savings target: £650m

What's been cut so far: The Cabinet Office has been told its budget will be reduced by £79m. Meanwhile, ministers have agreed to take a 5% pay cut and David Cameron has announced an end to bonuses for most civil servants. The Government Car Service is being streamlined, with most ministers no longer given a dedicated limousine or driver. The Central Office of Information, which is not part of any one department but oversees government advertising and marketing campaigns, is estimated to have lost almost half its budget for this year, with warnings that staff will be cut by two-fifths. Cabinet Office minister Francis Maude has called for "golden goodbye" payments for senior civil servants to be phased out. He was among the first ministers to reach agreement on spending cuts with the Treasury.

Communities and Local Government


Department's key responsibilities: Planning, housing, working with councils, community relations

Annual budget: £33.6bn

Cut required to meet 25% savings target: £8.4bn

What's been cut so far: The Department for Communities and Local Government was told to save £780m as part of the £6.2bn spending cuts for the current year. Local Authority "leaders' boards", which coordinate planning across regions, have been cancelled, which it is envisaged will save £16m. Regional government offices are being axed, as are regional development agencies. Funding to councils for transport projects, new homes schemes and education have been cut by £1.1bn. The social housing budget in England is to be cut by 50%, the BBC understands. Communities Secretary Eric Pickles has said he wants his department to spend less on bureaucracy, cutting "red tape". He has abolished the Audit Commission, which monitors local government spending, in an effort to save £50m a year. Mr Pickles has been appointed to the "star chamber" committee after being among the first ministers to agree cuts at his department with the Treasury.

Culture, Media and Sport

UK athletes training

Department's key responsibilities: The arts, broadcasting, creative industries, licensing and gambling, libraries, museums and galleries, the National Lottery, sport and tourism

Annual budget: £2bn

Cut required to meet 25% savings target: £500m

What's been cut so far: In the £6.2bn round of savings, the Department of Culture Media and Sport was told to cut back £88m. Since then, the government has also pulled the plug on the planned £25m visitor centre at Stonehenge. The UK Film Council, which costs £15m a year and employs 75 people, is going, along with 15 other bodies, including the Museums, Libraries and Archives Council. The BBC's licence fee is expected to be frozen for the next six years with the Corporation also taking on responsibility for funding the World Service, the Welsh language channel, S4C, and the roll-out of broadband to rural areas. This will increase the BBC's costs by £340m a year at a time when its income is frozen. The largest chunk of the extra costs will come from the World Service currently £272m a year, paid for by the Foreign Office. It is estimated that these new obligations for the BBC will mean a 16% cut in real terms over the next six years.

Rumour mill: The Guardian has reported that up to 50% of staff at the department could lose their jobs.


Royal Navy exercise

Department's key responsibilities: Britain's armed forces, including training, deployment and equipment

Annual budget: £46.1bn

Savings made: The Ministry of Defence budget is to be cut by 8%, the government has announced.

What's been cut: The first strategic defence review in more than 10 years has now been announced, with 42,000 armed forces personnel and MoD civil servants to lose their jobs over the next five years and major defence projects cancelled. The Harrier jump jet and Nimrod reconnaissance plane will be scrapped. Some squadrons of Tornado jets will be saved but Kinloss is expected to close as an RAF base and 5,000 RAF jobs will be cut. The Army will have to cut up to 7,000 personnel over the next five years, and lose 40% of its tanks and 35% of its heavy artillery. The Ark Royal, launched in 1985, will be decommissioned immediately, rather than in 2014 as planned. The construction of two new aircraft carriers, HMS Queen Elizabeth and HMS Prince of Wales, will go ahead, as it would cost more to cancel the projects than proceed with them but one of them will be mothballed rather than entering service and the other will be fitted with equipment for the Joint Strike Fighter rather than the Harrier. The navy will lose 5,000 personnel and its surface fleet will be cut from 23 to 19. It will get a new fleet of Astute-class nuclear-powered submarines. The government says £750m ($1.2bn) will be saved over four years on the replacement for Trident nuclear missile system by scaling back its firepower. The final "main gate" spending decision on Trident will also be delayed until 2016 - after the next general election. The Ministry of Defence will lose 25,000 civilian staff over the next five years. It will also have to renegotiate contracts with industry and sell-off "unnecessary" buildings and assets.

Spending review branding

A special BBC News season examining the approaching cuts to public sector spending



Department's key responsibilities: Pre-school, schools, family, youth crime policy, Ofsted inspections, apprenticeships

Annual budget: £57.6bn

Cut required to meet savings target: Education has been asked to prepare plans for cuts of between 10% and 20%. This would come to between £5.7bn and £11.5bn.

What's been cut so far: When the government announced its £6.2bn savings plan in June, some £670m of this was to come from the Department for Education's spending. Becta, the IT agency with an £80m budget, was one of the casualties. Education Secretary Michael Gove has also said the Building Schools for the Future project will go - scrapping about 700 rebuilding or improvement projects. Michael Gove has frozen grants to 132 councils for building and running up to 1,300 playground schemes. He has said his flagship "free schools" programme, which enables groups of parents and charities to set up their own state-funded schools, should cut the need for much of the centralised bureaucracy in the education sector. Deputy PM Nick Clegg has announced £7bn investment over four years in what he calls a fairness premium - targeted help for the poorest children in England through pre-school, school and on to university. The BBC understands that the schools budget will be protected - while the rest of the education budget will see a significant cut. An email from Universities UK head Professor Steve Smith suggests universities face funding cuts of £4.2bn - based on figures in Lord Browne's review of university funding in England.

Energy and Climate Change


Department's key responsibilities: Energy policy (including renewables), reducing damage to climate (including keeping to emissions targets)

Annual budget: £3.1bn

Cut required to meet 25% savings target: £775m

What's been cut so far: The Department for Energy and Climate Change, set up under Gordon Brown's government, has been told to save £85m. Of this, £34m is to come from spending on low-carbon technology and £6.1m from efficiency savings and under-spending on programme budgets. Some £4.7m is to be saved by cancelling the final funding rounds of the Bio-Energy Capital Grants Scheme and the Bio-Energy Infrastructure Scheme, with £1m coming out of development of deep geothermal energy generation. The scope of the Offshore Wind Capital Grants Scheme will be reduced, saving £3m. And the Carbon Trust will receive a £12.6m reduction to this year's grant for low-carbon technology and in its business support funding. The £30bn plans for 10-mile dam - the Severn estuary barrage - have been axed. Energy Secretary Chris Huhne has reached a settlement with the Treasury and is one of the ministers now sitting on the "star chamber", which will judge other departments' spending plans. However the deal does not include nuclear and coal legacy costs which are being dealt with separately.

Environment, Food and Rural Affairs


Department's key responsibilities: Food and farming, the countryside, wildlife and pets, sustainable development

Annual budget: £2.9bn

Cut required to meet 25% savings target: £725m

What's been cut so far: The Department for the Environment Food and Rural Affairs has been ordered to look for savings of £162m. It says this will be achieved by measures including limiting recruitment and reducing the number of non-permanent staff, IT efficiencies and cuts to rural development agencies. Environment Secretary Caroline Spelman has reached agreement with the Treasury on cuts to departmental spending. She has joined the "star chamber", sitting in judgement on other ministers who have yet to agree cuts.

Rumour mill: The Guardian reports that the government is considering selling off nature reserves, privatising parts of the Forestry Commission and withdrawing grants to British Waterways, which manages hundreds of miles of canals and rivers.

Foreign Office

Union flags

Department's key responsibilities: Promoting the UK abroad, diplomacy, consular services

Annual budget: £2.2bn

Cut required to meet 25% savings target: £550m

What's been cut so far: The Foreign Office has been told to save £55m, mainly by targeting its "lower-priority" activities. The government says this can be achieved by increasing its asset sales overseas and more "collaborative procurement" with other departments which have a presence abroad, such as the Department for International Development. Foreign Secretary William Hague has reached agreement with the Treasury on a programme of cuts. He has promised to streamline the Foreign Office's communications, making more use of social media networks like Twitter. Four quangos look set to be abolished, including the Caribbean Board. The Guardian has reported that Mr Hague has plans to cut £560,000 from the budget for monitoring human rights "failures" around the world.


Surgeons scrubbing up before operation

Department's key responsibilities: Hospitals, GPs, health improvement, social care, dentistry, eye care

Annual budget: £106.4bn

Cut required to meet savings target: The Department of Health has had its overall budget protected from cuts, as promised in the Conservatives' election manifesto.

What's been cut so far: The English NHS, which takes up the vast bulk of the department's budget, has been told to save up to £20bn by 2014 to help it cope with increasing pressures from the ageing population, rising price of drugs and lifestyle-related problems, such as obesity. Prime Minister David Cameron has announced an end to bonuses for most NHS managers. Some projects have also been cancelled, including the £2m Walk England scheme and the £6m County Sports Partnerships. The government has scrapped the building of the £450m North Tees and Hartlepool Hospital. And savings of £700m have been announced in the National IT programme for the NHS in England - designed to create a national computer infrastructure for the health service. Health Secretary Andrew Lansley plans to abolish two tiers of management and get GPs to manage budgets, and has put aside £1.7bn this year to do so. He says it will cut management costs by 46% over four years and improve patient care. NHS Direct in England is also being scrapped, to be replaced with an alternative service. And 30 quangos have been proposed for abolition - including the Health Protection Agency. In Scotland the SNP have pledged to cut the number of senior NHS bosses by 25% in four years - to fund policies like a pledge to abolish prescription charges. The BBC understands £2.1bn extra will be provided in the spending review to protect adult social care - which is not part of the ring-fenced NHS budget.

Home Office

Newly qualified police officers

Department's key responsibilities: Policing, anti-terror operations, crime prevention, immigration, passports

Annual budget: £10.2bn

Cut required to meet 25% savings target: £2.55bn

What's been cut so far: Theresa May's department has been told to make £367m in cuts. Of this £135m is to come from police efficiency savings and £82m from "arm's-length" bodies such as National Policing Improvement Agency and the Serious Organised Crime Agency. Mrs May has also said nothing will be off limits in a review of police pay and conditions - due to report in June 2011.

Rumour mill: The Chief Inspector of Constabulary, Sir Denis O'Connor, has said the Home Office can cut its spending on policing by 12% through a "total redesign" of working practices. The Police Federation, which represents rank and file officers, predicts as many as 40,000 front-line posts could go in England and Wales over four years. The Scottish Police Federation predicts 2,800 posts could go in Scotland.

International development

Sugar cane harvesting in India

Department's key responsibilities: Aid to poorer countries, including poverty alleviation and redevelopment projects

Annual budget: £7.7bn

Cut required to meet savings target: The Department for International Development's overseas aid budget has been protected from cuts, but not its other costs.

Rumour mill: A leaked Department for International document, passed to the press by Labour, suggests the coalition has put together a wide-ranging list of possible projects to be cut. The department says all projects are "under review". International Development Secretary Andrew Mitchell has also ordered a review of the Commonwealth Development Corporation, which funds businesses in some of the poorest parts of the world, following reports of lavish expense claims.


Royal Courts of Justice

Department's key responsibilities: Courts system, prisons, probation, elections

Annual budget: £9.7bn

Cut required to meet 25% savings target: £2.43bn

What's been cut so far: Ken Clarke's Ministry of Justice became the first Whitehall department to give its outline figure for savings demanded ahead of the autumn Spending Review, saying it planned to cut £2bn of its budget. The Public and Commercial Services Union estimates this will mean that 15,000 of 80,000 staff will have to be laid off. The department's finance director, Ann Beasley, acknowledges the situation will be "extremely challenging". In the earlier round of savings outlined by the government in May, the Ministry of Justice was told to economise to the tune of £325m. The government is also considering closing 157 magistrates' and county courts across England and Wales.

Rumour mill: There is expected to be a major reduction in prison places, meaning more community sentences.

Northern Ireland/Scotland/Wales

Departments' key responsibilities: Policy devolved from the UK government

Annual budget: £55.5bn

Cut required to meet 25% savings target: £13.9bn

What's been cut so far: The devolved administrations have been asked to make savings of £704m, but have an option to defer them this year. The first ministers of Scotland, Wales and Northern Ireland have issued a joint statement saying cuts are "too fast and too deep" and should be phased in over a longer period.

Possible targets for future cuts: All areas covered by the devolved administrations.


Plane passing over house

Department's key responsibilities: Roads, rail, aviation, shipping

Annual budget: £13.6bn

Cut required to meet 25% savings target: £3.4bn

What's been cut so far: The Department for Transport has been told to make savings of £683m. Local authority grants must be reduced by £309m, with Transport for London also getting £108m less. Meanwhile, Network Rail has to cut its spending by £100m and the department is making £112m savings in its direct expenditure. The department is also to defer the spending of £54m for "lower-priority" projects, including some railway rolling stock and road improvement, such as on the A23 in West Sussex and between junctions 5 and 8 of the M6. But Chancellor George Osborne has said funding for big infrastructure projects - like London's £16bn Crossrail and the £431m Mersey Gateway road bridge - will continue. The Commons transport committee has warned that train passengers could face large fare rises as subsidies are cut.


Treasury sign

Department's key responsibilities: Deciding Whitehall budgets, HM Revenue and Customs, taxation, Royal Mint

Annual budget: £4.4bn

Cut required to meet 25% savings target: £1.1bn

What's been cut so far: George Osborne has announced that people paying the higher, 40% rate, of income tax will no longer be able to claim child benefit from 2013, in a bid to save £1bn. The £11bn-a-year benefit has been available to parents, regardless of income. The government is committed to a public sector pay freeze for all but lowest paid over the next year. The CBI, which represents British industry, says this will save £28bn over two years. Child Trust Funds payments will be scaled back from August this year and then stop altogether from 1 January next year, saving £300m. To raise revenue, Chancellor George Osborne has promised to increase VAT and capital gains tax, while introducing a new tax for banks. Perhaps unsurprisingly, the Treasury was among the first departments to reach an agreement on its spending cuts.

Rumour mill: A Treasury source has told the Financial Times that staff numbers at the department could be cut by a quarter over the next four years. And reports persist that child benefit for 16 to 19-year-olds could be abolished. The BBC understands discussions are continuing about whether to abolish it altogether from age 16 - or to keep it from 16 for the poorest families.

Work and Pensions


Department's key role: Benefits, pensions, Jobcentre Plus

Annual budget: £9bn (This is for departmental spending set every three or four years - separate from the £192bn spending on welfare and pensions)

Cut required to meet 25% savings target: £2.25bn

What's been cut so far: The Department for Work and Pensions was told in May to make savings of £535m. This included £200m through efficiencies, £70m from stopping or delaying some IT projects and reduced spending on IT consultancy, and £85m from discretionary spending on areas such as marketing, travel and research. The DWP said £335m would mainly come from "refocusing recession measures where we believe we can make taxpayers' money go further and benefit more people". Separately Chancellor George Osborne has said he wants to make savings from "annually managed expenditure" - which includes the costs of things like welfare and pensions - to reduce cuts to department budgets. Work and Pensions Secretary Iain Duncan Smith has reached an agreement with him about introducing a universal credit - moving all benefits onto one system of payment over 10 years, which they say will eventually save £9bn a year and encourage people to work. Mr Osborne says £4bn will be cut from the welfare bill, which is not the same as the department's budget, at the autumn spending review - on top of £11bn already announced. Mr Duncan Smith has said he "doesn't recognise" that figure. The government has promised to remove benefits for up to three years from people convicted three times of benefit fraud, impose £50 fines for even minor welfare offences and to recruit more inspectors to find benefit cheats.

Rumour mill: Chancellor George Osborne is aiming to big savings in the mammoth DWP budget - but has faced a battle with Welfare Secretary Iain Duncan Smith over welfare reform. Labour says the start-up costs of the single credit system could be as much as £7bn - but Mr Duncan Smith says billions more could be saved in the long-term through reduced fraud, waste and error. It appears that Mr Duncan Smith may have got his way, but there may be cuts elsewhere to pay for the revamp of the benefits system. The government has played down reports that ministers have agreed to cut £2.5bn from the employment and support allowance - paid to those too sick to work. There are also reports the winter fuel allowance for elderly pensioners is to fall by up to £100 per household. But plans to force the BBC to pick up the £600m bill for free television licences for the over 75s are reported to have been ruled out by the DWP.

Why we're in this situation

Tax and spending

The government predicted in the June Budget that a total of £697bn would be spent in the year to the end of March 2011.
It expects to raise £548bn in the year through taxation, with the biggest contributors being income tax, national insurance and VAT.
In order to make up the difference between expected taxes and spending, it will have to borrow £149bn.
The biggest areas of spending are health, education and social protection, which includes benefits such as jobseeker's allowance.
If big savings are to be made without cutting areas such as health or international development, other areas will have to be cut significantly.
There may also have to be cuts to pay for the interest that has to be paid on the government's debt, which will grow as borrowing rises.
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