Yesterday afternoon the Chancellor Gordon Brown outlined his 11th successive budget in Parliament.
Delving into the details it is noteworthy to think about the planned public sector expenditure – given that the public sector activity accounts for nearly half of UK economic activity.
Looking beyond the usual suspects of health and education, where the Government continue to pour our tax pounds in without having built in safeguards to ensure effective spending to achieve the desired effect, of particular interest are defence and transport – this is clearly unsustainable.
The annex in the budget outlines spending by ministry in terms of resources (day-to-day spend on salaries, operations etc.) and capital (investment in new equipment and infrastructure).
In both the defence and transport cases, although investment (or capital budgets) will increase a little, the resource budget is set to fall in the next year.
The effect for those in the North East who use the roads is that they may fail to be maintained as effectively – with new schemes favoured over support to existing ones.
For families serving in the armed services from the region, there will be investment in new ships aircraft and tanks, but the training, welfare, accommodation and salaries of service personnel and their families will take a firm second place.
Given today’s tax rises as the Chancellor’s first act as Prime Minister in waiting I would like to be first to forecast his successor’s budget to be the first to reign in an unsustainable public sector spending spree in 2008.
