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Defra reaches agreement with Osborne over scale of budget cuts

Defra has reached an agreement with Chancellor George Osborne about the extent of cuts to its budget over the next five years.


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Defra faces a major upheaval as a result of forthcoming budget cuts
Defra faces a major upheaval as a result of forthcoming budget cuts

Defra has reached an agreement with the Treasury that could see cuts of around 30 per cent made to its resource budget over the next four years, Chancellor George Osborne has announced.

 

Defra is one of four Government Departments to agree to cuts averaging 30 per cent across them. The others are the Treasury, itself, plus the Transport and Local Government Departments.

 

The news has prompted renewed concerns over Defra’s ability to respond to major disease outbreaks and that other front-line services damaged.

 

Mr Osborne announced ’provisional agreement on the spending plans of four government departments’ had been reached during a speech in London on Monday morning.

 

He stressed the average 30 per cent savings related to the Departments’ resource budgets, that is their ’day to day spending’, and not their capital budgets.

 

He said: "These savings will be achieved by a combination of further efficiencies in departments, closing low value programmes, and focusing on our priorities as a country.

 

He stressed the Government would continue to invest in capital infrastructure projects ’that make our economy more productive’, including ’updating our roads and railways; investing in flood defences to protect our homes and businesses; and delivering superfast broadband across the country’.

Full details

The full details of that capital settlement and the result of the local government settlement will be announced at the Spending Review on November 25.

 

The chancellor asked most Departments, with some exceptions - Health and overseas aid were ring-fenced - to submit plans for savings of between 25 per cent and 40 per cent by the end of the current parliament.

 

Defra submitted its initial proposals earlier in the autumn and has been negotiating the finer details ever since.

 

Mr Osborne said: "The provisional settlements I’ve outlined today mean that four of the twenty Whitehall departments have been settled."

 

He thanked his Cabinet colleagues from the Departments that have now settled, including Defra Secretary Liz Truss ’for their efforts in delivering all this’.

 

The situation for Defra appears even more stark, given the drastic cuts over the next few years come on the back of huge reductions to the Department’s budget during the previous Parliaments, as the graph below shows.

 


Read More

Defra spending cuts - where the axe could fall Defra spending cuts - where the axe could fall

Defra's declining budget

Defra's declining budget

Where the Defra cuts could fall

See our in-depth analysis here outlining how Defra could set about slashing its budget over the next four years.

 

In summary, measures include:

 

  • Further redundancies across Defra and its 34 arm's-length bodies.
  • Closer working between Defra's bodies, particularly where there is duplication, for example, Natural England, Environment Agency and Forestry Commission. This includes more sharing of functions like IT, HR and media functions.
  • Removing or reducing spending on various projects. For example, Defra spending on the Campaign for the Farmed Environment is under threat.
  • Devolving policy to local level or, in other words, asking others to do the work. This includes giving farmers and landowners more responsibility to carry out their own flood maintenance work.
  • Reducing spending on research and, in some cases, looking for alternative funding sources.
  • 'Smarter policy', for example using satellite technology to reduce the number of physical inspections on farms.
  • Charging/cost sharing - increasingly charging for services such as environmental permits and licences.
  • This principle will apply in animal health, with, for example, certain aspects of TB control, such as testing, compensation and reactor removal, likely to come under the spotlight in terms of 'who pays?'

Major concern

Mrs Truss has insisted ensuring Defra's ability to respond to emergencies like major disease outbreaks and flooding remains a ’major priority’.

 

But confirmation of the scale of the cuts has generated unease within the veterinary community.

 

British Veterinary Association president Sean Wensley said: "In recent years we have already seen the impact of significant cuts to Defra’s budget on veterinary fees for TB testing and other OV services and on disease surveillance.

 

"Our major concern is that more cuts in these areas could further erode the UK’s preparedness for a disease outbreak, which could have massive implications for animal and human health, animal welfare and the reputation of UK agriculture.

 

"The Defra Secretary of State has repeatedly said that animal health and welfare is a priority so we would urge Defra to protect animal health and welfare budgets relative to other areas of spend and ensure that short-term savings do not lead to serious adverse consequences in the longer term."

Damage front-line services

MR

NFU President Meurig Raymond said any cuts to the Defra budget must not impact on its responsibilities for driving through its food and farming strategy, animal health, flooding and its payment functions.

 

He said: “Our priority is for farming businesses to be productive and profitable and we are concerned that cuts of up to 30 per cent could damage front line delivery services that underpin this aim.

 

"That is why we believe that Defra should first seek savings in ‘back office’ functions rather than reducing spending on areas that are key to our members, such as animal health, flood protection and a fully functioning Rural Payments system."

 

He said the NFU also had concerns about cost recovery.

 

"If this simply means paying for the continuation of services that could be delivered more effectively and efficiently," he said.

 

"We believe that there is scope for some services, including some provided by agencies such as the Environment Agency, to be delivered more cost-effectively by other providers."

 

Country Land and Business Association president Henry Robinson said: "Defra is an important department that does crucial work to support farmers and others across the rural economy.

 

"It also oversees a regulatory framework that is fundamental to how rural businesses make decisions.

"It is critical these changes do not undermine vital services.

 

"We will work closely with officials to help them understand how they can achieve their objectives and ensure priority work like administering basic payments, flood protection, Natural Capital work, tackling animal and plant disease and ensuring regulatory enforcement is efficient and targeted.”

Loss of confidence

Mr Osborne warned if the government did not control spending there was a risk of loss of confidence in the economy.

 

"The deficit could bring our country down," he said. "While debt is high, our economic security is in danger."

 

Defra Deputy CVO to leave post

Defra's Deputy Chief Veterinary Officer Alick Simmons is leaving his post at the end of this year after 30 years as a Government vet.

 

In a social media post, Mr Simmons, who started at Defra in 2007, following spells at the Food Standards Agency and Ministry of Agriculture, Fisheries and Food, said: “It looks as if there is a change coming. After 30 years being a Government veterinarian, I will be leaving the civil service at the end of 2015.”

 

A Defra spokesman insisted his departure was not linked to forthcoming spending cuts and ongoing moves to reduce staff numbers across Defra and its agencies.

 

But the spokesman confirmed changes to Defra’s internal structures were being discussed with senior staff.

 

She said: “Last month we briefed our deputy directors in strategy, international and biosecurity and policy delivery about forthcoming changes to the way we deliver our policy and evidence work across Defra.

 

“The new senior structure which was set out will better enable us to deliver our five-year strategy and make it easier for our key stakeholders and delivery partners to work with us.”

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