Budget train crash

Brightwave's Managing Director, Charles Gould shares his thoughts on the budget and the potential impact it will have on the learning and development industry.

So the promised cuts in public spending in this week's budget have materialised. What with the increase in VAT as well, pretty much everyone will feel the pinch. George Osborne's crusade to shrink the state (to under 40% of the economy, lower even than in the Thatcher years) will have profound implications for all sectors, including learning and development. Here's my own view on what I think it means.

• Clearly, cutting the cost of every government department (apart from health) by 25% will mean job losses in the public sector. It will mean fewer resources available for front-line services which in turn will severely stretch back office services like training.


• The increase in VAT will make life tough for retailers, quite apart from rising unemployment meaning less money in people's pockets. Job losses here must be inevitable


• The shrinking state, by definition, means more emphasis on the private sector for renewed economic growth. It's true there has been some cheer for business with the reduction in corporation tax. But our export markets have rarely been in worse shape with the Eurozone reeling and the US struggling to climb out of recession (and not exactly predisposed to buying British in the light of BP's environmental - and PR - disaster).

All this means that training spend will come under closer scrutiny than ever. Public sector training will be hacked back to the bare minimum. Efficiencies in learning and development will be sought and that will mean more e-learning and more outsourcing. In the private sector, learning and development must absolutely demonstrate business impact and return on investment. There will be no room for 'nice to have' training, only that which improves performance, reduces cost and has a measurable impact on the bottom line.

Pain now, more pain later. How will the learning and development industry respond?

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