Chancellor Rishi Sunak will conduct a one-year Spending Review in late November to priorities the government’s response to Covid-19 and focus on supporting jobs.
The Treasury has announced that the review will take place on November 25. It replaces long-term Comprehensive Spending Review that was planned.
It said it was “the right thing” at the moment to “focus entirely” on protecting jobs and responding to the crisis.
The change comes as economic experts warn that the UK is at risk of a double-dip recessions.
The Covid crisis had already led to the scrapping of the Autumn Budget in favour of the long-term review.
The new review will now settle government departments’ resource and capital budgets for 2021-22, and the devolved administrations’ block grants for the same period.
Multi-year NHS and schools’ resource settlements will be fully funded, as will priority infrastructure projects.
The government says the review will build on business support measures that have already been introduced and will focus on three areas:
• Providing departments with the certainty they need to tackle Covid-19 and deliver a ‘Plan for Jobs’ to support employment
• Giving public services enhanced support to continue to fight against the virus alongside delivering frontline services
• Investing in infrastructure to deliver plans to “unite and level up the country”, drive economic recovery and “Build Back Better”
Announcing the move the chancellor said: “In the current environment its essential that we provide certainty.
“So, we’ll be doing that for departments and all of the nations of the United Kingdom by setting budgets for next year, with a total focus on tackling Covid and delivering our Plan for Jobs.
“Long term investment in our country’s future is the right thing to do, especially in areas which are the cornerstone of our society like the NHS, schools and infrastructure.
“We’ll make sure these areas crucial to our economic recovery have their budgets set for further years so they can plan and help us Build Back Better.”