Business issues

2030 Public Services

Financial constraint means the UK is facing big choices about public service priorities in the coming years

Up to 48% of men and 43% of women in the UK could be obese by 2030, adding up to £2bn a year in medical costs
- The Lancet

The UK faces significant financial constraint not just today, but in the longer term - as a result of social, demographic and global pressures. This means we have to make big choices as a country about our public services if we are to keep the books balanced.

The CBI believes opening up services to a diversity of providers is a major part of the answer to our short and long term challenge, and the case for moving further and faster on public service reform is compelling.

Pressure on public spending

Securing private sector growth and reducing the deficit are rightly the most important priorities for the government at the moment. We need a leaner, fitter public sector that delivers more for less.

Press release: 'We can't afford to bury our head in the sand' >>
Videos: Public services leaders give their views >>
Read Matthew Fell and Nick Pearce's Guardian article >>
Read the full report (pdf)

But we also need to keep an eye on the longer term social, global and demographic forces that will put pressure on public spending, at a time when – based on current trends – tax receipts are expected to fall.

Long-term pressures on spending could come from a range of sources including an ageing population, chronic diseases, higher expectations of public services by the public, changing family and social structures, climate change and the pressure to stay competitive in the world with the rise of new economic powers.

What next?

The number of people over the age of 85 in the UK is expected to more than double over the next 25 years
- Office for National Statistics

We need to make big choices about our public services both now and for the future. The CBI and IPPR held a high-level roundtable event in May to discuss the options with public service providers and policy experts.

While there was no consensus on the way forward, a briefing paper by IPPR sets out some of the key ideas that emerged. Three major themes highlighted in the paper are:

Prioritisation
We’ll need to decide which services to prioritise funding for. This could mean directing more money towards services that are central to economic growth and that could have export potential; that raise the employment rate such as childcare; or other services that help to realise key economic and social goals.

Prevention
We could look at making a shift from reactive towards preventative services that help to save significant amounts of money in the longer term. For example, this could mean shifting from acute care to community care; or from spending on prison to spending on reducing re-offending.

Productivity
There is significant scope to increase productivity across a range of public services. This could be done in a number of ways including automating more areas of public service delivery and opening up public services to private and voluntary sector providers to unlock innovation and deliver savings.

Solution

The CBI believes opening up services to private and voluntary sector providers must be a major part of the solution, helping us to meet our immediate and longer term spending challenge and delivering an increase in quality, choice and value for money. The CBI will this year be publishing a major report on the openness of public service markets and the potential benefits of moving further and faster on reform.