‘Reimagining the Spending
Review: A New Model for Smarter Public Spending'
The Government should scrap the traditional Spending Review and
replace it with a smarter, more responsive approach, according to
the Institute for Global Change
(TBI).
Published today, ‘Reimagining the Spending Review: A New Model
for Smarter Public Spending' is led by Dr Laura Gilbert, TBI's
Senior Director for AI, and formerly Director of Data Science at
Number 10, alongside Alexander Iosad, Jeegar Kakkad and Eleni
Arzoglou.
Under the traditional spending review process, departments spend
thousands of hours preparing submissions, often in the dark about
competing bids, while allocations rely heavily on subjective
judgement. Once funding is allocated, government has limited
visibility into whether initiatives are succeeding or failing,
and little ability to course-correct.
As a result, ineffective projects go on being funded, not enough
money is available for what's needed, and public trust is
undermined.
While governments have long aspired to make public spending more
efficient, new technology has unlocked far greater opportunity.
Recent innovations from the Treasury, such as internal AI tools
and shared dashboards, show promising progress. However, the
impact of these changes is hampered by deeper structural
problems.
TBI's report argues that a more fundamental redesign harnessing
technology is needed to meet the challenges of today.
Dr Laura Gilbert, lead author of the report,
said:
“When a company spends money, it understands that that money is
limited. If what you're spending the money on isn't working, the
company should demand for you to stop and spend it on something
else that drives the outcomes you want.
“The way the traditional Spending Review process is set up
prevents this level of accountability in Government. As a result,
Whitehall can waste huge amounts of money – our money - on things
that don't work, and keep doing it again.
“We cannot afford to operate like this when the technology to fix
it is there.”
At the heart of the report are three key recommendations:
- Scrap the traditional Spending Review: replace the rigid,
cyclical process of budget reviews with a more dynamic approach
that aligns spending with delivery and outcomes, not outdated
assumptions.
- Move to real-time tracking: use modern technology to monitor
government programmes continuously, making it easier to spot
what's delivering value and what isn't, and to communicate this
to taxpayers.
- Spend on what works, cut what doesn't: shift from funding by
habit to funding by evidence. Programmes that deliver results
should be scaled up; those that don't should be stopped.
The paper sets out a roadmap to reform the system before the next
Spending Review, proposing a new approach grounded in real-time
data and quarterly performance check-ins. This ‘always on'
monitoring, similar in style to private sector money management,
would enable Government to cull more projects, faster, when
they're not working, and re-allocate money to better performing,
more needed projects.
The report also recommends shorter, sharper ‘strategic reviews'
every two years, allowing government to continue planning for the
medium-term, while remaining agile.
By freeing civil servants from the bureaucratic burden of
outdated processes, and equipping them with real-time insights
into programme effectiveness, the government can unlock better
outcomes for people and restore public trust in how money is
spent.
“We owe it to taxpayers to make sure every pound counts,” said Dr
Gilbert.
“This isn't about spending more or less. It's about spending
better—on what works, and on what improves people's lives.”
