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| Version 1 | Version 2 |
|---|---|
| Ed Balls' speech: fact checking the shadow chancellor | Ed Balls' speech: fact checking the shadow chancellor |
| (4 months later) | |
| Three years into the coalition government and two years ahead of the next general election, the shadow chancellor has delivered one of his most important speeches yet - "to set out Labour's approach" to the economy. | Three years into the coalition government and two years ahead of the next general election, the shadow chancellor has delivered one of his most important speeches yet - "to set out Labour's approach" to the economy. |
| Critics will have a hard time accusing him of being non-specific since the shadow chancellor himself was clear "we will not set out our plans for 2015-16 this year". Nevertheless, the questions he raised were clear suggestions about where Labour would try to find savings and the extent of possible cuts. | Critics will have a hard time accusing him of being non-specific since the shadow chancellor himself was clear "we will not set out our plans for 2015-16 this year". Nevertheless, the questions he raised were clear suggestions about where Labour would try to find savings and the extent of possible cuts. |
| Here, we've taken the three key savings identified by Ed Balls, as well as one source of potential economic growth, and seen how realistic the economic benefits are. | Here, we've taken the three key savings identified by Ed Balls, as well as one source of potential economic growth, and seen how realistic the economic benefits are. |
| Freeze on free schools | Freeze on free schools |
| Today's speech stated: | Today's speech stated: |
| With primary school places in short supply in many parts of the country, and parents struggling to get their children into a local school, can it really be a priority to open more free schools in 2015 and 2016 in areas with excess secondary school places? | With primary school places in short supply in many parts of the country, and parents struggling to get their children into a local school, can it really be a priority to open more free schools in 2015 and 2016 in areas with excess secondary school places? |
| A Department for Education release showed that 24 free schools had been opened in 2011 and a further 55 in 2012. Data on capital funding is only available so far for 18 of these free schools - it shows that between them, they had capacity for 5,707 pupils and that costs for refurbishment and acquisition totalled £71.3m. | A Department for Education release showed that 24 free schools had been opened in 2011 and a further 55 in 2012. Data on capital funding is only available so far for 18 of these free schools - it shows that between them, they had capacity for 5,707 pupils and that costs for refurbishment and acquisition totalled £71.3m. |
| The Local Schools Network would seem to agree with Ed Balls' point about "excess". They pointed to Stour Valley Community School which they claim received full funding for 540 pupils, despite having only 185. | The Local Schools Network would seem to agree with Ed Balls' point about "excess". They pointed to Stour Valley Community School which they claim received full funding for 540 pupils, despite having only 185. |
| If we were to take these 18 schools and average the total acquisition and refurbishment costs we would arrive at a figure of £4m per school. The current government plans 102 new free schools "in 2014 and beyond". To assume the maximum possible savings, the rate of 55 new schools per year would continue, all of which would have the excess capacity the shadow chancellor referred to. | If we were to take these 18 schools and average the total acquisition and refurbishment costs we would arrive at a figure of £4m per school. The current government plans 102 new free schools "in 2014 and beyond". To assume the maximum possible savings, the rate of 55 new schools per year would continue, all of which would have the excess capacity the shadow chancellor referred to. |
| That would mean the freeze proposed by Labour could represent a saving of £220m per year. | That would mean the freeze proposed by Labour could represent a saving of £220m per year. |
| Abolition of police commissioners | Abolition of police commissioners |
| Another potential source of savings was identified by the shadow chancellor when he posed the question: | Another potential source of savings was identified by the shadow chancellor when he posed the question: |
| When we are losing thousands of police officers and police staff, how have we ended up spending more on police commissioners than the old police authorities, with more elections currently timetabled for 2016? | When we are losing thousands of police officers and police staff, how have we ended up spending more on police commissioners than the old police authorities, with more elections currently timetabled for 2016? |
| Last month, the Commons home affairs select committee published their first report on police and crime commissioners' (PCC) pay, interests, costs, second jobs and offices. The results were not very positive. | Last month, the Commons home affairs select committee published their first report on police and crime commissioners' (PCC) pay, interests, costs, second jobs and offices. The results were not very positive. |
| The committee found that 17 out of the 41 PCCs had set budgets higher than the police authorities they replaced - in the case of Hampshire the increase was 133%. These increases were large enough that they more than offset the 19 PCCs which had budgets less than the original police authorities. In total, £4.8m was overspent by 17 PCCs and £3.5m was underspent by 19 other PCCs, giving a net overspend of £1.3m. | The committee found that 17 out of the 41 PCCs had set budgets higher than the police authorities they replaced - in the case of Hampshire the increase was 133%. These increases were large enough that they more than offset the 19 PCCs which had budgets less than the original police authorities. In total, £4.8m was overspent by 17 PCCs and £3.5m was underspent by 19 other PCCs, giving a net overspend of £1.3m. |
| If annual trends were to continue, abolishing police commissioners could save approximately £1.3m a year. | If annual trends were to continue, abolishing police commissioners could save approximately £1.3m a year. |
| Means-testing winter fuel allowance | Means-testing winter fuel allowance |
| On this, Balls asked the public the following: | On this, Balls asked the public the following: |
| ...can it really remain a priority to pay the Winter Fuel Allowance - a vital support for middle and low income pensioners - to the richest 5% of pensioners, those with incomes high enough to pay the higher or top rates of tax? | ...can it really remain a priority to pay the Winter Fuel Allowance - a vital support for middle and low income pensioners - to the richest 5% of pensioners, those with incomes high enough to pay the higher or top rates of tax? |
| A House of Commons paper considered the viability of this in October 2012. It argued: "Introducing a separate means-test would introduce complication and significantly increase administrative costs (the Winter Fuel Payment, based on simple age criteria, is relatively straightforward and cheap to administer)." | A House of Commons paper considered the viability of this in October 2012. It argued: "Introducing a separate means-test would introduce complication and significantly increase administrative costs (the Winter Fuel Payment, based on simple age criteria, is relatively straightforward and cheap to administer)." |
| Age UK attempted to put some numbers to the higher costs of means-testing - they claim that new claims could cost £260 more, and existing claims could cost £33 more. | Age UK attempted to put some numbers to the higher costs of means-testing - they claim that new claims could cost £260 more, and existing claims could cost £33 more. |
| Rajeev Syal has reported a Treasury source as saying: "One pledge that saves less than half a per cent of the welfare budget is utterly meaningless when they have pledged to borrow and spend tens of billions more." | Rajeev Syal has reported a Treasury source as saying: "One pledge that saves less than half a per cent of the welfare budget is utterly meaningless when they have pledged to borrow and spend tens of billions more." |
| However in a commons debate in 2011, Steve Webb, Minister of State for Pensions claimed that if only those receiving pension credit were to receive winter fuel payments, forecasted expenditure would fall from £2.1bn to £0.6bn. | However in a commons debate in 2011, Steve Webb, Minister of State for Pensions claimed that if only those receiving pension credit were to receive winter fuel payments, forecasted expenditure would fall from £2.1bn to £0.6bn. |
| Excluding the additional administration costs (we would need to know the annual numbers of new and existing claimants of winter fuel payments) this measure would save approximately £1.5bn per year. | Excluding the additional administration costs (we would need to know the annual numbers of new and existing claimants of winter fuel payments) this measure would save approximately £1.5bn per year. |
| Infrastructure boost | Infrastructure boost |
| The shadow chancellor made reference to a policy advocated by the International Monetary Fund (IMF) of a £10bn boost to infrastructure investment. Balls suggested: | The shadow chancellor made reference to a policy advocated by the International Monetary Fund (IMF) of a £10bn boost to infrastructure investment. Balls suggested: |
| If the entire infrastructure boost recommended by the IMF was spent on housing over the next two years, we calculate that it would allow the building of around 400,000 affordable homes across the country, and support over 600,000 new jobs in construction, including 10,000 apprenticeships | If the entire infrastructure boost recommended by the IMF was spent on housing over the next two years, we calculate that it would allow the building of around 400,000 affordable homes across the country, and support over 600,000 new jobs in construction, including 10,000 apprenticeships |
| The average wage of those in the 'skilled construction and building trade' according to the Office for National Statistics is £24,600. According to the National Audit Office, £236m was allocated "to support the development of" 80,000 affordable homes across England by 2014-15, working out at approximately £2,950 per home. | The average wage of those in the 'skilled construction and building trade' according to the Office for National Statistics is £24,600. According to the National Audit Office, £236m was allocated "to support the development of" 80,000 affordable homes across England by 2014-15, working out at approximately £2,950 per home. |
| If those values hold true, the shadow chancellor's plans would amount to £0.6bn on building affordable homes and £14.5bn on construction workers for each year of the programme. That would mean we spent £15.7bn - well over the £10bn IMF money that was referred to even if you assume that 10,000 apprentices aren't paid a penny and that the plan only lasts a year. | If those values hold true, the shadow chancellor's plans would amount to £0.6bn on building affordable homes and £14.5bn on construction workers for each year of the programme. That would mean we spent £15.7bn - well over the £10bn IMF money that was referred to even if you assume that 10,000 apprentices aren't paid a penny and that the plan only lasts a year. |
| The overspend could theoretically amount to £5.7bn. | The overspend could theoretically amount to £5.7bn. |
| Sum | Sum |
| Other potential policies were also mentioned in the questions which Ed Balls raised, such as whether "it makes sense to introduce a mansion tax on properties worth over £2m"? These could result in savings for government and as the shadow chancellor himself sought to repeatedly emphasise, the issues raised in today's speech did not constitute Labour promises. | Other potential policies were also mentioned in the questions which Ed Balls raised, such as whether "it makes sense to introduce a mansion tax on properties worth over £2m"? These could result in savings for government and as the shadow chancellor himself sought to repeatedly emphasise, the issues raised in today's speech did not constitute Labour promises. |
| But, if all the assumptions above hold true, the main suggestions outlined in today's speech would result in spending of just under £4bn. | But, if all the assumptions above hold true, the main suggestions outlined in today's speech would result in spending of just under £4bn. |
| Context | Context |
| The question many may ask is whether these changes are feasible and whether they are sufficient. With public sector net borrowing at £85.1bn, and £159bn spent on benefits alone, the jury is out. | The question many may ask is whether these changes are feasible and whether they are sufficient. With public sector net borrowing at £85.1bn, and £159bn spent on benefits alone, the jury is out. |
| Read the speech in full here | Read the speech in full here |
| You can share your views by posting a comment below or by tweeting to @GuardianData or @MonaChalabi | You can share your views by posting a comment below or by tweeting to @GuardianData or @MonaChalabi |
| More open data | More open data |
| Data journalism and data visualisations from the Guardian | Data journalism and data visualisations from the Guardian |
| Development and aid data | Development and aid data |
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| • This article was amended on 7 June 2013. The original said that the Local Schools Network "found that Eden Primary School had just 30 pupils - well below its capacity for 210". Peter Kessler, the founder of the school, has pointed out that it admits 30 children per year into its reception class and is operating at its current full capacity; it is in its second year of operation and has a full complement of 60 pupils; after seven years it is expected to have 210 pupils. Mr Kessler gives further details in a comment posted below under the username "foldgate". | • This article was amended on 7 June 2013. The original said that the Local Schools Network "found that Eden Primary School had just 30 pupils - well below its capacity for 210". Peter Kessler, the founder of the school, has pointed out that it admits 30 children per year into its reception class and is operating at its current full capacity; it is in its second year of operation and has a full complement of 60 pupils; after seven years it is expected to have 210 pupils. Mr Kessler gives further details in a comment posted below under the username "foldgate". |
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