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Spending review 2013

26 June 2013

The Spending Round sets out Government’s plans for spending in 2015-16

Key aspects of the review

Apprenticeships, 16-19 reforms and Higher Education

  • The Government is to reduce spending on FE and HE by £400 million in 2015-16.

The Spending Review prioritises spending on apprenticeships. The Government will consult this summer on options for major reform of apprenticeships funding to place purchasing power directly in the hands of employers and to make payments to employers. (1.19) The Government says it is committed to raising the quality of apprenticeships and to implementing key reforms in the Richard Review.

Reforms to the 16-19 sector continue, including implementation of the funding reforms recommended by Doug Richard and Alison Wolf.

The Traineeships programme will be extended to 19-24 year olds, to help support young people to make the transition from education into work.

A National Scholarship Programme will support postgraduate students from disadvantaged backgrounds. The £50 million fund will be administered by the Higher Education Funding Council for England (HEFCE). HEFCE will allocate the money competitively to higher education institutions, and will attract additional scholarship funding from the private sector or from the institutions’ own resources.

In higher education, student maintenance grants will be maintained in cash terms in the 2015-16 academic year saving £60 million. At least £45 million will be saved through asking HEFCE to reprioritise teaching grant spend. This is currently used to provide support for disabled students. We will be working with universities and disability partners to ensure disabled students continue to receive the support they need.

Childcare

  • Consultations in July on the details of the new scheme of Tax-Free Childcare as announced at Budget 2013. This will support working families with childcare costs from autumn 2015. 

Health and social care

  • An additional £2 billion a year through the NHS to join up local health and social care services to deliver better, more efficient care, with a £3.8 billion pooled budget to be shared between local health and care systems. An extra £200 million will be made available in 2014-15 to accelerate this transformation.

Local Government

  • Making funding available for local authorities that choose to freeze their council tax in 2014-15 and 2015-16.
  • Planning to set a council tax referendum threshold in each of those years that gives local people a say if their council tax rises by more than 2 per cent.

Social Security Benefits

  • £300 million allocated in 2015/16 for Universal Credit.
  • The Government is announcing a reform package that includes:
  1. Cap on welfare spending to cover all benefits (£100 billion of welfare spending) with the exception of basic and additional state pension and those benefits affected by unexpected heavy demand (such as Jobseeker’s Allowance where there is high number of claimants due to another recession). The cap will be set in the 2014 budget.

  2. requiring claimants to do more at the start of their claim. At their first application for benefits, claimants will be asked to write a CV, register with the Government’s new Universal Jobmatch service, and start looking for work. Claimants will have longer initial interviews with Jobcentre advisors to support this.

  3. requiring all unemployed claimants, and those earning less than the Government expects them to, to wait seven days before becoming eligible for financial support. This extends the current three-day waiting period for JSA claimants.The extended waiting period will not apply to people claiming contributory JSA or the Employment and Support Allowance (ESA).

  4. introducing weekly signing for around half of all job seekers.

  5. quarterly restart interviews for all job seekers.

  6. claimants whose spoken English is a barrier to work will be expected to improve their language skills, with sanctions for those who fail to attend mandatory courses.

  7. requiring all claimants who are subject to conditionality to verify their claim each year to eliminate fraud.

  8. expecting lone parents to prepare for work when their youngest child turns three.

  9. The Government will test different approaches to supporting Employment and Support Allowance (ESA) claimants in the Work Related Activity Group to move closer to work, including through engagement with healthcare professionals. This includes engagement with healthcare professionals.

  10. The Government will consider how to best support young unemployed people in 201516 to bring together an evidence-based effective offer for this group. Details will be announced in due course.

  11. £350 million has been allocated for spending on programmes and support for people with a disability or long term health condition to move into and stay in work. The Government will consider how best to allocate this alongside work on the disability employment strategy due to be published later this year.

  12. From autumn 2015, Winter Fuel Payments will no longer be payable to people living in a European country with an average winter temperature higher than the UK, saving £30 million a year. This is in response to a recent European court judgement that means more people in Europe can now claim Winter Fuel Payments.

Work experience Health and Safety checks - DfE

  • The insurance industry has committed to treat work experience students as employees so that they will be covered by existing Employers’ Liability Compulsory Insurance policies. New ‘stripped down’ health and safety guidance on students taking part in work experience  was published today by the HSE: http://www.hse.gov.uk/youngpeople/workexperience/index.htm

An updated work experience ‘readiness checklist’ targeted specifically at post-16 providers offering work experience though 16-19 Study Programmes from this September can be found here

https://education.gov.uk/schools/teachingandlearning/qualifications/b00223495/post-16-work-exp-enterprise-educ/creating-work-exp-opp-young-people

For more information on the Spending Review go to www.gov.uk/government/news/spending-round-2013-next-stage-in-governments-plan-to-move-from-rescue-to-recovery

View our response to the Spending Review.