Spending cuts are often false economies that end up costing society dearly | Torsten Bell

ethe government is looking to save money. Sometimes the priority is to cut spending, as with austerity after 2010. Even when overall spending is rising, policymakers can cut spending in one area to make priority progress elsewhere. Doing things more efficiently is always a good idea.

But announcing spending cuts is not the same as cutting costs, let alone achieving value for taxpayers’ money. This is a key lesson from years of austerity. Cuts hastily announced in one area today have repeatedly led to increased spending elsewhere tomorrow.

Cash-strapped social care hurts those in need, but it also costs us a fortune when we can’t discharge those who could be at home with the right support. The Treasury’s attempts to cut their housing benefit bills by freezing support in line with 2019 rent levels, even as rents surged, pushed homelessness to record highs (145,800 children are already in temporary accommodation) leaving some already stretched councils to see their temporary accommodation costs increase nearly 40% last year.

A new study by the Institute for Fiscal Studies, looking at the effects of the closure of 70% of London’s police stations in 2010, found that violent crime (assault and murder) increased by 11% in neighborhoods where stations were closed. They found that for every pound ‘saved’, it increased the costs faced by society by £3.

Hard decisions cannot be avoided, but it is time to wake up to the fact that getting real value for money for taxpayers is far more difficult than announcing big cuts today, only to let others pick up the pieces later. With a government assuming after elections cuts of 13% in some departments this is what should be considered.