This report shows how the UK Government's existing spending review process fails to align government spending with strategic priorities and long-term value for money. It recommends resetting the approach to spending reviews and introduces more effective ways of managing public spending.   

The new UK government has taken office with a bold set of missions: it has pledged to, for example, secure the highest sustained growth rate in the G7 and deliver zero carbon electricity by 2030. These pledges come on top of a daunting inheritance, with  most public services performing worse now than they were in 2010 or before the pandemic.

This report argues that ambitious targets will require a substantial reorientation of government activity, including how and where it spends money, ensuring that every pound spent delivers the greatest possible value. 

Key recommendations 

• Define the government’s missions in a ‘Priorities for Government’ framework, to guide decision making in the spending review and enable the prioritisation of spending
• Set multi-year spending plans covering five years, which would be reviewed every three years
• Publish multi-year spending plans at least six months before they come into effect
• Establish a regular cycle and method for spending reviews
• Review demand-led spending and tax expenditures
• Avoid early settlements and the ‘protection’ of individual budgets from the start of the spending review process
• Produce and publish robust multi-year spending baselines for each department at the start of the spending review process
• Task an independent body to scrutinise multi-year spending baselines and plans, and
• Reset and align expectations of how evidence is used in spending review allocations