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“It’s a big deal for this government,” says Simon Case.

“It’s the clearest indication yet of what they plan to do between now and the general election, a translation of their manifesto.

“This is where you should expect the chancellor to say, on behalf of the government: ‘This is what we’re about’.”

As the former cabinet secretary, Mr Case was the man in charge of the civil service during the last spending review, in 2021.

On Wednesday, Rachel Reeves will unveil the Labour government’s priorities for the next three years. But it’s unclear whether it will provide all that much of an answer about what it’s really about.

Unlike the Autumn budget, when the chancellor announced her plans on where to tax and borrow to fund overall levels of spending, the spending review will set out exactly how that money is divided up between the different government departments.

Since the start of the process in December those departments have been bidding for their share of the cash – setting out their proposed budgets in a negotiation which looks set to continue right up to the wire.

This review is being conducted in an usual level of detail, with every single line of spending assessed, according to the chancellor, on whether it represents value for money and meets the government’s priorities. Budget proposals have been scrutinised by so called “challenge panels” of independent experts.

It’s clear that health and defence will be winners in this process given pre-existing commitments to prioritise the NHS – with a boost of up to £30bn expected – and to increase defence spending.

On Sunday morning, the government press release trumpeted an impressive-sounding “£86bn boost” to research and development (R&D), with the Science and Technology Secretary Peter Kyle sent out on the morning media round to celebrate as record levels of investment.

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What will be in spending review?

We’re told this increased spending on the life sciences, advanced manufacturing and defence will lead to jobs and growth across the country, with every £1 in investment set to lead to a £7 economic return.

But the headline figure is misleading. It’s not £86bn in new funding. That £86bn has been calculated by adding together all R&D investment across government for the next three years, which will reach an annual figure of £22.5bn by 2029-30. The figure for this year was already set to be £20.4bn; so while it’s a definite uplift, much of that money was already allocated.

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Peter Kyle also highlighted plans for “the most we’ve ever spent per pupil in our school system”.

I understand the schools budget is to be boosted by £4.5bn. Again, this is clearly an uplift – but over a three-year period, that equates to just £1.5bn a year (compared with an existing budget of £63.7bn). It also has to cover the cost of extending free school meals, and the promised uplift in teachers’ pay.

In any process of prioritisation there are losers as well as winners.

We already know about planned cuts to the Department of Work and Pensions – but other unprotected departments like the Home Office and the Department of Communities and Local Government are braced for a real spending squeeze.

We’ve heard dire warnings about austerity 2.0, and the impact that would have on the government’s crime and policing priorities, its promises around housing and immigration, and on the budgets for cash-strapped local councils.

The chancellor wants to make it clear to the markets she’s sticking to her fiscal rules on balancing the books for day-to-day spending.

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But the decision to loosen the rules around borrowing to fund capital investment have given her greater room to manoeuvre in funding long-term infrastructure projects.

That’s why we’ve seen her travelling around the country this week to promote the £15.6bn she’s spending on regional transport projects.

The Treasury team clearly wants to focus on promoting the generosity of these kind of investments, and we’ll hear more in the coming days.

But there’s a real risk the story of this spending review will be about the departments which have lost out – and the promises which could slip as a result.

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More Britons than ever struggling to make ends meet, report warns

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More Britons than ever struggling to make ends meet, report warns

More people than ever are struggling to live on their current income – while just a third say they are living comfortably, according to new research.

Rising prices and sluggish pay increases have put many people’s finances under strain in recent years.

A record 26% now say making ends meet is difficult. Before the pandemic, it was 16%.

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UK inflation slows to 3.4%

Two-thirds also say their incomes haven’t kept up with inflation, according to the British Social Attitudes report.

That’s only marginally better than the 70% recorded during the height of the cost of living crisis in 2023.

Frozen tax thresholds also appear to be hitting home, with 61% saying taxes on low earners are too high, while 44% believe middle income earners also pay too much.

Those figures are up nine points and 13 points respectively since 2016.

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However, when it comes to the highest earners, 44% believe their taxes are too low.

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Britain’s energy price problem

The report also asked people about the welfare system – a timely insight with Labour MPs currently rebelling over plans to save £5bn from the budget.

It found support for more spending on disability benefits is at a record low of 45%, down from 67% in 2017 – but only 11% think spending should be reduced.

About 29% of those polled think it’s “too easy” for people to get disability benefits – but the same percentage also feel it’s “too difficult”.

Meanwhile, long waiting times appear to have played a part in the finding that a record 59% are now dissatisfied with the NHS. In 2019, it was just 25%.

Only 21% said they were satisfied with the health service.

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Reeves pledges NHS funding

The report is based on a representative, random sample of more than 4,000 people in the UK and was produced by the National Centre for Social Research.

It’s the longest-running measure of public opinion in Britain, having started in 1983.

Professor Sir John Curtice, senior research fellow, said: “The public are well aware of Britain’s problems – not least those of a failing health service and an economy in which many are struggling to make ends meet.

“Yet rather than turning their back on the state, for the most part, the public are still inclined to look to government to provide solutions.”

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What is NATO’s 5% defence spending goal?

Defence was also a key theme of the report – and researchers found about 40% of Britons support spending more money on weapons and troops.

A fifth (20%) said they would like to see a reduction.

It comes as the government revealed it was buying at least 12 stealth jets that can carry nuclear weapons, and as NATO countries, including the UK, promise to increase defence spending.

The National Security Strategy also said the UK must prepare for the potential of a “wartime scenario” in the “UK homeland” for the first time in many years.

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Almost everyone surveyed (90%) considered Russia a serious threat to world peace, followed by Iran (78%), North Korea (77%), Israel (73%), and China (69%).

The percentage supporting more defence spending remains relatively unchanged since 2016, before Russia invaded Ukraine.

However, the share supporting an increase is significantly higher now than that in 2006 (28%) and in the 1990s (17%).

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Post Office scandal: Govt has not done enough to ensure compensation for victims, committee of MPs finds

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Post Office scandal: Govt has not done enough to ensure compensation for victims, committee of MPs finds

The government has not done enough to ensure all victims entitled to compensation from the Post Office scandal have applied for it, a report has found.

Many current and former postmasters affected by Horizon IT failings and associated miscarriages of justice are not yet receiving fair and timely compensation, according to the report by the Public Accounts Committee (PAC).

Only 21% of the 18,500 letters the Post Office sent to postmasters to make them aware of the Horizon Shortfall Scheme had been responded to, figures provided by the Department for Business and Trade (DBT) show. About 5,000 further letters are expected to be sent in 2025.

Under the scheme, current and former postmasters who were financially affected by the Horizon IT system, but who were either not convicted or did not take the Post Office to the High Court, can either settle their claim for a final fixed sum of £75,000 or have it fully assessed.

There is also the Horizon Convictions Redress Scheme (HCRS), which is for sub-postmasters who had their convictions quashed after the passing of the Post Office (Horizon System) Offences Act last year.

The 800 or so sub-postmasters who are eligible to claim under the HCRS are entitled to a £600,000 full and final settlement, or the option to pursue a full claim assessment.

By the end of March, 339 had accepted the settlement sum, the report by the PAC, which is made up of MPs from all sides of the House of Commons, found.

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But the PAC report states that the government has no plans to follow up with people who are, or may be, eligible to claim but are yet to apply.

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‘They knew software was faulty’

The committee recommends that the DBT should outline what more it will do to ensure every affected postmaster is fully aware of their options for claiming.

A third scheme provides compensation to sub-postmasters who were wrongly convicted of fraud, theft and false accounting.

Of the 111 sub-postmasters eligible to claim for the Overturned Convictions Scheme and who are either entitled to a £600,000 full and final settlement, or to pursue a full claim assessment, 25 have not yet submitted a claim, some of whom represent the most complex cases.

The DBT has taken over the management of the scheme from the Post Office, and the PAC report recommends that the department should outline how it plans to handle the remaining cases under the scheme.

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Sir Geoffrey Clifton-Brown MP, chair of the PAC, said thousands of people were “deeply failed” by the system during “one of the UK’s worst ever miscarriages of justice”.

He added: “This committee would have hoped to have found government laser-focused on ensuring all those eligible were fully and fairly compensated for what happened.

“It is deeply dissatisfactory to find these schemes still moving far too slowly, with no government plans to track down the majority of potential claimants who may not yet be aware of their proper entitlements.

“It is entirely unacceptable that those affected by this scandal, some of whom have had to go through the courts to clear their names, are being forced to relitigate their cases a second time.”

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The evidence that Russia sanctions evasion has intensified

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The evidence that Russia sanctions evasion has intensified

For more than a year, we have been tracking the flow of sanctioned items out of the UK and towards Russia.

Electronic equipment, radar parts, components used to make aircraft and drones. These are all items that have been banned from going to Russia. For good reason: while Britain is far from a global manufacturing powerhouse, it nonetheless still makes certain prized components used to make machinery.

In some hands, these components could be used for peaceful purposes, but they could also be used to wage war. All of which is why they are among the items sanctioned by G7 nations and banned from entry to Russia.

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A glance at the trade figures might lull you into thinking those sanctions have been extraordinarily successful. Look at the flows of these so-called “dual use” goods from the UK to Russia and they drop to zero shortly after the invasion of Ukraine and the imposition of those export bans. But that’s not the whole story – because over precisely the same period, exports of those same items to countries neighbouring Russia have risen sharply.

At this point, the data trail goes cold. As far as the statistics tell us, those components stay in the Caucasus and Central Asia. But there are two powerful pieces of evidence that suggest otherwise. The first is that we have travelled out to the border of Russia and filmed European-sanctioned goods (in this case cars, the hardest of all goods to disguise) passing across the border.

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Zelenskyy: Sanctions needed as countries supplying missile components to Russia

The second is that Ukrainian forces have repeatedly found weaponry and equipment containing European and British components inside them on the battlefield in their country. British technology has been used to kill Ukrainians – in spite of sanctions. That was one of the messages President Volodymyr Zelenskyy relayed in his interview with my colleague Mark Austin.

So, in the wake of that interview, we revisited the databases to see if those flows of goods to Russian neighbours had slowed in recent months.

Conway2

But, far from slowing, they’ve accelerated. In the past nine months, the flow of dual-use goods to Russian neighbours has risen by an average of 9%, compared with the monthly average between the Russian invasion of Ukraine in 2022 and last June. Those flows are 111% higher than they were before the invasion.

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Conway3

Nor are the flows of British goods to Russian neighbours the only trend suggesting these components are being trans-shipped via third countries. Look at exports of sanctioned items to the United Arab Emirates and Turkey and they are up by a similar proportion.

In short: the evasion of sanctions continues much as it has done since the beginning of the war. For all the talk about the toughest sanctions regime in history, the reality on the ground is somewhat different.

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