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17 billion: the simple number in a complex election


7 May 2015

As ballots are counted in the most unpredictable general election in recent history, the make-up of the next government remains up in the air even once the polls have closed.

Each of the three main parties stands a chance of drafting the next Queen’s speech; indeed, according to some opinions, all three could be involved at one stage or another. A complex parliamentary arithmetic affords this and many other possibilities.

Amid the uncertainty, it is promising that early intervention and prevention is a theme present in each party’s manifesto. The Conservative platform includes targeting the drivers of crime such as drugs and alcohol, protecting vulnerable children from sexual exploitation, and developing social impact bonds around youth unemployment, mental health and homelessness. Labour are keen to protect investment in the early years (including Sure Start) and in children’s mental health, and have emphasised the role of social and emotional skills in the school curriculum. While additional funding for mental health is a key plank of the Liberal Democrat campaign, their manifesto also mentions improved support for pregnant women, increasing the early years pupil premium and ensuring that all children reach school readiness by 2020.

So, in a world of unknowns, it’s a relatively safe bet that early intervention will have some role to play in the next legislative agenda. This is just as well, because whatever the next government looks like, it will face the same core issue: how to balance the nation’s books, which necessitates a further round of spending cuts, while also managing higher demand on public services that are already under strain. Another safe bet is that the next chancellor will scratch his or her head wondering how to achieve one aim without neglecting the other.

Is this simply a trade-off that must be accepted? We don’t think it has to be. Recall our report launched earlier this year, which found that the state spends some £17 billion every year on ‘late intervention’: picking up the pieces of social problems that affect children and young people, when it would be much better and cheaper to stop them happening in the first place. The case is simple enough to make itself.

We will be drawing an incoming government’s attention to the £17 billion figure, which cannot be sustainable in the current context. Of course, the fiscal cost is surely dwarfed by the human one: if the financial imperative to prevent these social problems is eye-catching, the moral one is inescapable.

Our challenge for the next administration is that it must reduce the need for costly (in all senses of the word) late intervention over the next parliament. We have set the target to reduce late intervention spend by 10% – £1.7 billion – between now and 2020, through effective early intervention.

This isn’t impossible, but it’s only achievable if the right steps are taken. We must do more to act earlier, helping a young person before they go into care, are excluded from school, develop mental health problems, or commit crime. But for this to happen, government and other bodies need to work differently. The Treasury needs to adopt a long-term outlook for public services, creating an environment that allows money to be shifted from late to early intervention. It also needs to encourage local agencies to work across boundaries, so that vulnerable children can be spotted early and root causes addressed. Finally, we need to use the best available evidence, focussing resources on the most effective support.

Above all, this requires decisive leadership from the centre. So we ask the next government to commit to:

  1. Greater use of effective early intervention. Use more effective early intervention to reduce the need for, and cost of, late intervention by 10 per cent – £1.7 billion – by 2020.
  2. The creation of an early intervention investment fund. Create a dedicated fund, drawn from existing spending and private sources, to incentivise high-quality, joined-up early intervention. The fund would offer to match the investment from the best plans submitted by councils, healthcare providers, police forces, schools, voluntary groups and other organisations to work together, redesigning local services around effective early intervention.
  3. Early intervention as a key theme for the next budget and spending review. Move towards longer-term planning for public spending to enable money to be shifted. To track progress on this, the government must finally start to measure what is spent on early intervention, how it is being used, and how it helps children and families.

About the author

Carey Oppenheim

Carey is an EIF associate and former chief executive.