N. I. Budget cut by 2% in Spending Review

27 June 2013

Northern Ireland's proposed resource budget for 2015/16 has been cut by 2% in George Osborne’s Spending Review.

Health and education form a large part of spending so the total budget has emerged relatively unscathed.

The Chancellor announced the end of automatic progression pay for civil servants and moves to end it for teachers, prison staff and police. That means most public sector workers will no longer receive annual length of service pay increases. He also announced a cap on pay increases for 2015/16 of 1%.

HMRC was one of several government departments to face cuts, but got away relatively lightly, with a 5% budget cut for 2015-16. The department is still expected to deliver more than £130m of efficiency savings in 2015-16 through improved productivity and “further digital transformation”.

In spite of the cuts, Osborne said he expected the department to increase its take by £1bn to reach £24.5bn the year after next. HMRC was allocated an extra £994m during 2010-15 to counter tax avoidance and evasion activity with the aim of raising an extra £9bn a year by 2014-15.

The Department of Business, Innovation and Science, meanwhile, will see its budget decrease by 6%. Overall, civil service jobs will be cut by 144,000 by 2015-16 and civil servants will no longer enjoy automatic pay rises, which will now be limited to 1%.

The transport department saw its budget increased to £9.5bn.

Some £50bn of capital investment was announced for 2015-16, increasing the amount allocated to infrastructure projects to around £300bn.

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