Wednesday, 13 November 2013

How much has the Coalition government cut public spending?

Here I present two charts showing how much public spending has changed over the last few years. Data are from HM Treasury; they can be downloaded here. (I also used data on population size from Trading Economics). I consider three measures of public spending: total real spending, total spending as a percentage of GDP, and total real spending per capita. Figures do not include money spent on the bank bailouts.

The first graph shows how public spending has changed since the Coalition government came to power. In 2010, the first year of the Coalition government, spending rose. (This may have been due to spending increases already planned by the previous Labour government.) In 2011, spending remained flat. In 2012, it began to fall. And in 2013, it continued to fall. Total real spending is now 2.8% lower than it was in 2009. Total spending as a percentage of GDP is now 2% lower. And total real spending per capita is now 5.9% lower.


Another way to examine how spending has changed is to compare current spending to pre-crisis spending. After all, spending increased considerably during the economic crisis. As the graph below shows, two of the three measures of spending are still above their pre-crisis levels. Total real spending is 2.3% higher than it was in 2008. Total spending as a percentage of GDP is 6.4% higher. And total real spending per capita is 1.7% lower.

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