EXCLUSIVE: Rachel’s 10 TRILLION pound secret – Where has this money gone?

With Ms Reeves focused on taxing us, we reveal £10 trillion extra spent on public services, for no return

Why more tax rises? Why can’t she fund her black hole with some small cutbacks?

In yesterday’s report – with our colleagues at Brexit Facts4EU – the second in our weekly ‘GBN Pre-Budget Specials’, we looked at Rachel Reeves’ record on inflation, after she had said in her very unusual pre-Budget statement: “Inflation is already much lower than the double digits seen under the previous government.” After debunking this attempt to mislead, we went on to look at some of the other comments she made, specifically about productivity.

The area of productivity which is directly within the government’s control is the productivity of the public sector, which always trails that of the private sector.

We showed that in 2024 the government spent £1.27 TRILLION on the public sector, and that productivity has barely increased in the last 30 years.

Today we go one step further in this ‘Pre-Budget Special – Supplementary’.

The 10 TRILLION pound shocker

The fact the government spent £1.27 trillion on the public sector in 2024 is shocking enough, but the Facts4EU and CIBUK teams have gone further. We have calculated how much extra in total has been spent, compared to the level of public spending in 1994 – just 30 years ago. As with our report yesterday, we converted 1994 prices into what they would represent today.

In short, we demonstrate that the public sector has been the beneficiary of over £10 TRILLION in extra funding, over and above what we would have spent if we had kept to the level of spending 30 years ago.

Naturally Rachel Reeves is only responsible for part of this figure. The point of this report is that any Chancellor, faced with this ever-growing ‘elephant in the room’, should immediately take action to reverse the trend.

‘A picture paints 10 TRILLION words…’

The chart below shows the cumulative amount of spending on the public sector, in today’s prices, as it has grown over the past 30 years. This is over and above the 1994 level, adjusted so that it represents today’s prices.

As more and more work has been computerised in the last 30 years, it might have been expected that our public services could have done more with the same money. Not so, it seems.

£10.25 TRLLION cumulative extra spend on the public sector above 1994 level

At 2024 prices

Spend in 1994 : £0.617 trillion
Spend in 2024 : £1.268 trillion
Total extra spend in 30 years, above 1994 level : £10.25 trillion

click to enlarge

[Source(s) : Office for National Statistics]

What are the possible explanations?

Yes, of course the population has risen, but that does not come close to explaining the increase. Below is a chart showing the increase in population. According to the official estimates the government and the public sector use, the population increased by 19.7% between 1994 and 2024. This compares with an increase of 105.4% in the annual spend on the public sector.

So the cost has increased by 5.4 times more than the rise in population. And as we all know, public services have not increased in line with any population increase in any event. If they had, we would all be able to get a GP appointment on the same day.

The 19.7% increase in population, 1994-2024

Would you work through the night for £1.27 per hour?

Rachel’s not the only one with a ‘black hole’ in her accounts…
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So, if the population increase doesn’t explain it, what other reasons could there be?

Have we seen a dramatic improvement in public services?
Is it quicker and easier to see your GP now?
Is the transport system better, more frequent, cleaner, safer, and more reliable?
Are our schools and hospitals all in pristine condition?
If your car is stolen, do you actually see a policeman taking on the case?
Is our road system in top shape, no potholes?
Are our armed forces much larger?
Do we have many more warships, battlefield tanks and weapons, and fighter planes?

.

If the answers to the above are no, then here are some more questions

Is it possible we have more quangos? (Yes.)
Do we have far more highly-paid managers? (Yes.)
Are there more government agencies and government-funded bodies, many overlapping? (Yes.)
Do we now have ‘Diversity, Equity and Inclusion’ (DEI) managers and officers, patrolling all departments? (Yes.)
Are we paying enormous subsidies to companies involved in vast Net Zero projects? (Yes.)
Have we allowed the Bank of England to sell off government bonds at massive losses in the billions? (Yes.)
Are civil servants told to use up all their maximum sick leave entitlement? (Yes.)
Has the ratio of managers to staff increased? (Yes.)

We are sure readers can think of more questions to ask.

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In short, is the public sector overmanned, over-managed, and overfunded?

Whatever the answers, the simple fact remains that our public sector has cost us £10.25 TRILLION more over the past 30 years, for no discernible increase in productivity.

COMING NEXT WEEK…

On Thursday next week, with our colleagues at Brexit Facts4EU, we will deliver the third in our ‘GBN Pre-Budget Specials’. It will reveal some simple facts which never see the light of day. Do not miss it!

Observations

With less than three weeks to go before Rachel Reeves stands up in the House of Commons to deliver her Budget statement to the House, all the indications are that she will not surprise us all with a robust and detailed programme of how the Government intends to reduce the vast sums demanded from the taxpayer, whilst at the same time improving productivity.

The very least the taxpayer should expect is an immediate return to the productivity increases achieved by the last government prior to the Covid pandemic.

Instead we will listen to a litany of tax rises, dressed up and excused by blaming anything and anyone she can, whether her excuses are plausible or not. This is not a party-political matter. Whichever party were in power, we think the hard-pressed taxpayer, and all the people who rely on public services, would demand that the vast sums now being spent should deliver far more value for money than is currently the case.

Furthermore, we believe a clear plan should be announced to reduce public spending year-by-year. The proceeds should first be used to eliminate the deficit and start to pay down our ballooning national debt. In tandem, a policy should be announced with a time-line to reduce taxes in the key areas which will encourage growth. Certain tax regimes should be abolished immediately, including those which have caused an exodus of rich entrepreneurs and investors. We will discuss all of this in more detail in our third report in the ‘GBN Pre-Budget Specials’ series.

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