In the Autumn Budget 2025, the Chancellor announced that the government would be introducing additional efficiency and savings targets to meet at the next spending review, scheduled for 2027.
Efficiencies and savings
The government has stated that it will be making further efficiencies and savings in day-to-day spending from 2028-29 onwards, saving £2.9 billion in 2028-29, rising to £4.9 billion in 2030-31.
The government has announced that these efficiencies include a saving of over £250 million over 5 years by “cutting the cost of politics”.
Police and crime commissioners
The abolishment of Police and crime commissioners (PCCs) is said to help to fund frontline officers to cut crime. Their roles will be absorbed by regional mayors wherever possible, meaning measures to cut crime will be considered as part of wider public services such as education and healthcare, and in areas not covered by a mayor, this role will be taken on by elected council leaders.
Local government structures
The government has also announced plans to re-organise local government structures, with the potential to reduce the number of councillors in local authorities by around 5,000 to generate savings and streamline accountability in local areas which may increase the burden on elected council leaders following the abolishment of PCCs, noted above.
Disposal of government assets
The government holds £2.7 trillion assets, £190 billion of which are property, plant and equipment and is seeking to generate income through the introduction of a £1 billion asset efficiency target. This target is to be met by 2030 through asset disposals and generation of new income from public sector assets. In addition to the existing £1 billion estate disposal target, this means the government will generate £2 billion in proceeds from the government’s asset base on behalf of taxpayers.
Benefits and potential issues
There are likely to be both positive and negative aspects of the disposal of government assets. One benefit is that these disposals can generate short term liquidity and reduce running costs incurred which will allow the government to reinvest in more appropriate assets, or other areas of required spending. Another argument can be made that this is a short-term benefit and over a longer period the costs incurred after selling these assets will outweigh the initial income.
Sale and Leaseback
As part of an August 2024 publication “Managing Surplus Government Property”, the government stated that “In cases where a property is held on a freehold basis and a government organisation wishes to retain it, either in whole or in part, there may be a case for disposing of the freehold interest and taking a leaseback”. The sale and leaseback of a property would mean that the running costs continue to be incurred and once the initial capital received from the sale has been eroded by lease costs, the use of the property would create a net deficit.
In keeping with the overall theme of everyone being asked to contribute, it is unsurprising to see the government including itself in the equation.
https://www.gov.uk/government/publications/budget-2025-document/budget-2025-html
https://www.gov.uk/government/news/police-and-crime-commissioners-to-be-scrapped