Ministers have just announced the police finance settlement for 2018/19 and while there is some cause for seasonal cheer the announcement deserves scrutiny.

My summary is:

• There is new central government money for police counter terrorism work (£50 million);
• There is £130 million extra to help forces meet unexpected costs (such as those arising from the Greater Manchester terrorist attacks) and to fund investments in new technology. This looks like a one off for next year;
• As the opposition has pointed out the actual grant to forces remains the same in cash terms, which of course in real terms means police grant to forces will continue to be cut by the overall level set in the spending review (a 1.4% real terms cut between 2015/16 and 2019/20);
• Ministers are allowing PCCs to increase their Band D council tax precept by up to £12 in 2018/19. If PCCs do this it is said it would bring in £270 million, which is a significant figure. However not all PCCs will increase their local taxes and it is a little cheeky to present a tax increase as if it were a Christmas present;
• The government also says that forces can access the £175 million Police Transformation Fund, but note this is not new money and is a top slice off the police budget announced by George Osborne in 2015.

How adequate a response is this to the pressures on the police service? In order to answer that question below I set this funding announcement in the context of the recent trajectory of police funding, look at the changing demands on the police and examine the impact of austerity so far in terms of outcomes experienced by the public.

What has happened to police funding since 2010?

Police budgets have significantly reduced since 2010. Overall according to the National Audit Office funding for police forces fell by 18% in real terms between 2010/11 and 2015/16, with a 25% cut in direct grant from central government being cushioned to some degree by the ability of police and crime commissioners to raise local council tax.

In 2015 the then Chancellor George Osborne announced that police funding would be ‘protected’ over the life of the current comprehensive spending review (2015/16 to 2019/20). In reality this has meant:

• central government grant to police forces was set to fall by 1.4% in real terms between 2015/16 and 2019/20. Note today’s announcement confirms this will continue;
• if police and crime commissioners made up the short fall by increasing council tax to the maximum allowable without triggering a local referendum, then overall that would mean police funding had been protected in cash terms over the course of the spending review period. Today’s announcement allows PCCs to increase taxes further than previously allowed to bring in another £270 million in theory;
• on top comes funding for police counter terrorism work and the Police Transformation Fund, intended to fund investment in transformational projects, which will remain at £175 million for 2018/19.

It is important to note that because police forces vary widely in the degree to which they depend on central government grant the cuts since 2010 have impacted with varying degrees of severity.   In 2015-16, the percentage of central government funding to forces varied from 46% in Surrey to 85% in Northumbria. Total funding to individual forces reduced by between 12% and 23% between 2010-11 and 2015/16.

What about reserves?

We have heard a lot about police forces sitting on large reserves: the NAO found in 2015 that force reserves increased by 35% between 2010-11 and 2013-14. However, as forces cannot run deficits these reserves were always intended to help forces cope with financial uncertainty, fund investments and offset funding reductions.

Although the government has raised the issue of reserves again today, it was already clear that forces are planning to run down reserves to deal with the on-going funding squeeze. Nottinghamshire PCC Paddy Tipping told the Home Affairs Committee recently that he expected police force reserves overall to fall from £1.6 billion to £806 million by 2020.

How have police forces responded to reduced budgets?

Police forces made £2.5 billion of savings between 2011/12 and 2014/15, through a mixture of measures, including:

• reorganising neighbourhood policing teams;
• improving call centre efficiency;
• closing and selling police stations;
• reducing procurement costs;
• freezing recruitment.

Inevitably this has meant a reduction in the size of the police workforce.   The table below shows the scale of these reductions.

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There has also been increased collaborative working between police forces, both in back office areas and in areas of operational policing.   In 2014-15, analysis of HMIC and CIPFA data found that around 12% of planned net revenue spending was on collaboration. HMIC estimates that the proportion of savings made from collaboration ranged from 0%–47% across forces and has noted that there is a lot more that could be done collaboratively.

What has happened to demand on the police?

Crime

As I have discussed elsewhere there is some dispute about what has happened to crime in recent years. According to the most reliable indicator of the overall amount of crime the Crime Survey for England and Wales, crime has fallen from a peak of around 19 million crimes a year in 1995 to 5.8 million incidents of crime in the year ending June 2017. This latest figure is a 9% reduction compared with the previous year.   Note that these estimates have until now not included the growing areas of fraud and computer misuse offences. If these offences are included there were an estimated 10.8 million incidents of crime in the year ending June 2017.

However, crime recorded by the police increased last year by 13%. The police recorded 583,782 more offences in the year ending June 2017 than in the previous year. All main categories of police recorded crime increased, including knife crime (26%), burglary (6%), vehicle-related theft offences (17%), theft from the person (11%) and shoplifting (11%).

ONS concludes that some of this is due to improved recording practices, but also that “there have been genuine increases in crime – particularly in some of the low incidence but more harmful categories.”

Regardless of whether the increase in recorded crime reflects an actual increase in crime, the more crimes that are recorded the more demand there is for a police response.

It is also worth pointing out that although we have seen a long term fall in traditional crime the crimes that are an increasing part of the police workload such as sexual offences in particular are more complex to investigate. This is shown by the fact that over the last 10 years the costs of crime for the police have not fallen as much as overall numbers of crimes.

Non-crime demand

Non-crime incidents account for 83% of Command and Control calls. According to the College of Policing the total number of incidents fell by 3% in the three years after 2011/12, but the rate of decline was much less for non crime incidents (1.8%) than crime incidents (6.7%).

We should note that since those figures were complied there seems to have been a sharp spike in demand. The NPCC reports an increase of 11% in 999 calls over the last year and some forces reported that over the summer of this year they were regularly experiencing New Year’s Eve levels of demand.   This may be because pressures on other services, particularly those supporting vulnerable people, have reached a point where we are seeing an increased number of critical incidents requiring a police response.

Has the service the public receive deteriorated?

In some ways the police can be seen as victims of their own success in that they have been able to make the savings required so far without the public noticing a major deterioration in the quality of service. A 2016 survey of public perceptions of crime and policing for HMICFRS found that:

• most people are satisfied with their local police and levels of satisfaction have not significantly changed compared to the previous year;
• two thirds perceive little change in local policing in the last year;
• there was a slight decrease in satisfaction among those who had contact with the police;
• however, significantly fewer people report having seen a uniformed police presence on foot or in a vehicle than did in the previous 2015 survey (19% say they have seen on foot, down from 26%; 42% in a vehicle, down from 48%).

We should qualify these figures by noting that:

• only 27% of people have any contact with their local police. This means that most people have little awareness of the service the police are providing in their area;
• it is likely to take time for reductions in service quality to feed through into public satisfaction and confidence.

It is difficult to assess the impact of austerity on police performance because, as the NAO notes, “the available indicators of financial stress are limited, and there is insufficient information on service stress”.

There are however some clear signs of a deterioration in service quality. In 2014, an FOI request by the Labour party found response times to 999 calls got longer between 2011 and 2013.   Twenty out of 27 forces in England and Wales which replied to the Freedom of Information requests said that response times had gone up, with just two saying they had fallen.

In 2016 HMICFRS assessed that ‘the position on crime prevention and local policing continues to deteriorate. In our assessment, local policing is the area of operational policing that shows the greatest decline in performance’.

One area where signs of stress are clear is among the police workforce itself. According to the Police Federation two thirds of officers reported low morale in 2017, up 5% on last year, and two thirds report increased workloads.   There was a 35% increase in police sick-leave specifically for psychological reasons between 2010/11 and 2014/15 and the Police Federation has found that the numbers of days lost in general long-term sickness absence increased by 32% between 2014 and 2016.

Conclusions

We have seen big cuts to police budgets and a major fall in the number of police officers and police staff. While crime has been falling in the long term, these figures hide the increased complexity of crime and the fact that new forms of crime have been rising (notably cyber crime and fraud). In the last year both recorded crimes and 999 calls have increased sharply, increasing the amount of work the police are required to do.

The government has recognised that there have been increased pressures on the police in recent months. In response it has announced some additional funds forces can access and given PCCs greater flexibility to increase council tax.

However, with police grants frozen in cash terms for the rest of the parliament funding will remain tight. The police service will have to look again at what savings can be made from new technology and increased collaboration between forces. They will also have to look to other public services to do more to reduce emergency demand in areas like missing children and mental health. Before today’s announcement we were looking at likely further reductions in the quality and scope of neighbourhood policing and increased response times. Today’s announcement is unlikely to change that.