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The Government is committed to providing new investment in Britain's public services. Spending on public services will be £59 billion a year higher by 2005-06 compared with 2002-03. 75 per cent of this increase will be spent on the Government's priorities of education, health, transport, housing and the fight against crime. Spending on the NHS will rise by 7.1 per cent a year in real terms up to 2007-08. The Government will set out spending plans for other public services up to 2007-08 in the 2004 Spending Review, which will conclude in summer 2004.

The Government is determined to secure value for money for the taxpayer and is matching resources with reforms across the public services to deliver better results. The Pre-Budget Report:

• describes the action the Government is taking to drive efficiency and cut bureaucracy in the public sector, releasing resources for front-line services;


• confirms that to meet the UK's international commitments, including in Iraq, the Government will carry forward the special contingency reserve, adding £0.5 billion this year and allocating £0.3 billion for next year; and


• announces an increase of £340 million in Government support to local authorities in England in 2004-05.

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