£1.165bn of savings will be made by reducing grants to Local Authorities. The Government will also remove the ringfences around over £1.7bn of grants to local authorities in 2010-11, to give them greater flexibility to re-shape their budgets and find savings.
• Health and defence
Savings in these protected areas will be reinvested in front line services in those departments.
Closing the British Educational Communications and Technology Agency and other savings in Department for Education quangos will save £80m. Schools, Sure Start and spending on 16-19 year-olds will be protected from any in-year spending cuts. Efficiency savings made within schools, Sure Start and 16-19 education will be recycled within their respective budgets.
• Child Trust Funds
Savings of £320m will be made from reducing and then stopping government contributions to the Child Trust Fund. The government intends to introduce legislation to scale back payments from August this year and then stop payments from 1 Jan 2011.
A further £320m will be cut from ending ineffective elements of employment programmes, including ending further rollout of temporary jobs through the Young Person’s Guarantee and removing recruitment subsidies from the Six-Month Offer.
• Housing and property
Reducing property costs will save an estimated £170m. There will also be £150m saved from cuts to the last government’s housing pledge. Social housing will be earmarked for protection where possible.
• Contracts and projects
Around £1.7bn will be cut by from delaying and stopping contracts and projects, including immediate negotiations to achieve cost reductions from the major suppliers to government.