With the UK facing levels of government spending uncertainty not seen in decades, this report warns that whoever wins the general election should launch a one-year spending round within the first few weeks of the new parliament and complete it ahead of a December 2024 spending ‘cliff edge’. 

It shows how the next general election will be held closer to the point at which government departments’ budgets expire than at any time in over 40 years – potentially much closer if the general election is held in the autumn or winter. No government since at least 1998 has left it later than November to set spending plans for the following financial year. 

Budgets reach a ‘cliff edge’ moment in December 2024 – completing a spending review any later would lead to high levels of instability – and with government departments, local authorities and devolved administrations not knowing their budgets from April 2025 there is already a risk of delayed and inefficient spending on services and projects. An autumn polling day could leave just weeks to set spending plans. A winter election could land the next government in unchartered territory from day one. 

Government spending commitments on the NHS, schools, childcare, international development and defence means  spending is set to fall in other areas by 2.6% per year in real terms over the next four years. Reconciling these spending plans, the wafer thin margin against fiscal rules adopted by both main parties, and poor performance of public services underlines the need for politicians and civil servants to prepare now for a series of highly consequential spending choices, both from politicians and the civil service.