Reflections on the 2025 Comprehensive Spending Review and its Implications for Local Government

Reflections on the 2025 Comprehensive Spending Review and its Implications for Local Government

As we move into the week following the 2025 Comprehensive Spending Review (CSR), it’s worth pausing to reflect on what has been an extraordinary 12 months since the snap election. The pace and breadth of change influencing public policy and fiscal planning have been relentless, and the CSR remains a critical mechanism through which the government sets its strategic direction for public expenditure.

A Brief History of the CSR

Comprehensive Spending Reviews are a cornerstone of the UK government’s fiscal planning framework. Introduced formally in 1998 under the Labour government of Tony Blair and Chancellor Gordon Brown, CSRs were designed to establish multi-year spending limits for government departments, ensuring that public funds are allocated efficiently and transparently.

The roots of this approach, however, stretch back to the 1961 Plowden Report, which advocated for a five-year forward look at public expenditure. This evolved into the three-year planning cycles that define modern CSRs. A few landmark reviews include:

• CSR 1998: The inaugural review under New Labour, setting the tone for improved efficiency and accountability.
• CSR 2007: Focused on curbing the growth of public spending and providing greater certainty for public sector managers.
• CSR 2010: Delivered by the Coalition government in the wake of the 2008 financial crisis, this review introduced sweeping austerity measures.
• CSR 2021: A pivotal review addressing the economic fallout of the COVID-19 pandemic, with major investments in health and social care.
• CSR 2025: The most recent review, centred on national renewal through investment in security, health, and economic growth, with departmental budgets set through to 2029–30 and new fiscal rules introduced to enhance transparency and stability.

Implications for Local Government

The 2025 CSR carries significant implications for local government. It outlines a 1.1% increase in grant funding to local authorities, with overall spending power projected to rise by 2.6% - a figure that includes revenue raised through council tax.

Importantly, the review underscores the role of local government in delivering the government’s broader reform and growth agenda. Key areas of focus include:

• Public sector reform
• Technology-led service transformation
• Green energy and sustainability initiatives

While these priorities present exciting opportunities, they also come with persistent challenges. The funding gap remains a concern, as does the increasing demand for services. Yet, the sector continues to demonstrate remarkable ingenuity and resilience. Across the country, we see exceptional leaders and executives navigating these complexities with integrity, vision, and a deep commitment to public service.

Celebrating Excellence in Local Government

This spirit of excellence was on full display during the recent awards season, including the Local Government Chronicle (LGC) and Municipal Journal (MJ) Awards. These events showcased the very best in local government innovation and leadership.

A special congratulations to Oldham Metropolitan Borough Council, winners of the Most Improved Council award. Their achievement is a testament to what can be accomplished through strong leadership and community engagement. Best of luck as well to all those shortlisted for the Senior Leadership Team of the Year - your work continues to inspire.