Sajid Javid announces ‘end of austerity’ with biggest public spending boost for 15 years

A 4.1% hike, worth £13.8bn in 2020-21, is the biggest since 2002 – but Labour calls it ‘a sham’

The chancellor has announced “the end of austerity” with the biggest increase in spending on public services for 15 years, despite the Brexit crisis.

Sajid Javid pledged extra cash for schools, hospitals, the police, prisons and the homeless – a 4.1 per cent hike in real terms, worth £13.8bn in 2020-21, the biggest since 2002.

In a spending round brought forward, with an eye on the looming general election, Mr Javid announced he was ripping up his spending rules in an apparent admission they would soon be bust.

The cash boosts went to the NHS (£6.2bn), education (£7.1bn – over three years), defence (£2.2bn) the police (£750m), further education (£400m) and special educational needs (£700m).

Mr Javid drew a line under the reign of Philip Hammond, the sacked former chancellor, by announcing: “No department will be cut next year.

“Every single government department has had its budget for day-to-day spending increased at least in line with inflation. That’s what I mean by the end of austerity.”

But the chancellor continued the much-criticised patch-and-mend approach to adult social care, with long-promised reforms – already delayed for two years – to be “set out in due course”.

Local councils would “have access to new funding of £1.5bn” next year, suggesting further council tax hikes rather than increased Whitehall funding.

John McDonnell, Labour’s shadow chancellor, attacked a “sham of a spending review”, accusing Mr Javid of using funds set aside for a no-deal Brexit which had “largely disappeared”.

“They are claiming to be against austerity – after years of voting for it,” Mr McDonnell said.

He contrasted £1.8bn for schools next year with the £10bn cut to education spending since 2010, saying: “Heads will still be sending out begging letters and teachers will still be buying basic materials for their classes.”

The respected Institute for Fiscal Studies said it was now “touch-and-go whether Sajid Javid will breach his current fiscal rules” on borrowing and debt.

“Borrowing now set to be a lot higher next year than projected in the spring and would be much higher still with no deal,” said Paul Johnson, its director.

Labour also poured scorn on just £30m being set aside to improve the environment despite Theresa May having vowed to achieve net-zero carbon emissions by 2050.

Matthew Pennycook, Mr McDonnell’s deputy, said the government’s own climate change advisers had “made clear that 2 per cent of GDP needs to be directed toward decarbonisation” to hit that target.

He protested: “Yet the chancellor today allocated only £30m toward it. A staggering failure to act.”

Friends of the Earth echoed the criticism, saying: “This spending review completely undermines the government’s commitment to taking the climate and biodiversity crisis seriously.”

And, on the social care cash, the Alzheimer’s Society said: “£1bn can only stave off the utter collapse of our social care system, neglected by successive governments for so long.”