Marketers can help recovery following £81bn public spending cuts

Marketers can help lead the UK economy back into prosperity now that the Government has taken the measures necessary to reduce the deficit, according to the Advertising Association.

Chancellor George Osborne has today (20 October) unveiled the details of the comprehensive spending review of public spending, which will see £81bn cut from public sector budgets by 2015.

Speaking in the House of Commons earlier, Osborne says the measures, designed to reduce the UK’s deficit, will pull Britain back from the “financial danger zone” and the “road to ruin”.

Departmental budgets will be cut by 19% on average, less than the 25% widely reported because of the £7bn cut to the welfare budget. A total of 490,000 civil servants will lose their jobs.

Commenting on the review, Advertising Association chief executive Tim Lefroy says that the spending review is “chapter one” but the next chapter is growth “and that’s where marketing and advertising comes in.”

“We drive competition and innovation, in all markets. Government has set out its stall on the Big Society – which is about giving people more choice and control in their lives. Advertising is choice and policy makers can benefit from the knowledge and expertise vested in this sector,” he says.

As part of the spending review, Government departments will be required to publish a business plan next month, setting out reform plans for the next four years.

Retail body, the British Retail Consortium welcomed the cuts, claiming that the “serious” plans to tackle the deficit will “remove some of the uncertainty which was driving down consumer confidence”.

“Beginning to deal with the deficit now is right. Delays would just store up more pain for later, risking increased borrowing costs, higher taxes and more job losses,” says the BRC’S director Stephen Robertson.

The Department of Culture Media and Sport will see its budget cut by £800m to £1.1bn by 2014/15 with a 41% cut in administration costs promised.

Savings include passing funding for the BBC World Service from the Foreign Office to the corporation. The BBC will also take on Welsh language station S4C.

Whitehall administration costs will be cut by £6bn, double the £3bn indicated earlier this year.

The Government set out its plans to cut marketing spending in June and has frozen all but essential spending on campaigns.

It is also cutting funding to its marketing services provider, the Central Office of Information, which is cutting staff by 40%.


The Secret Marketer on agency relationships

David Coveney

Lots of time with the agencies this week and a mixed bag of progress. There appears to be a very direct correlation with the quality of my brand managers and the quality of work coming out of the agencies. Some might say that it is down to the quality of the brief itself, but I […]


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