The Government’s advertising budget is set to fall by up to 15 per
cent in the financial year which ends next month.
The drop is a setback for agencies and contradicts previous forecasts
that Labour ministers would maintain their high-level of spending up to
the general election.
The surprise fall will also undermine a campaign by the Tory opposition
to accuse Labour of using taxpayers’ money for party political
advertising. The Tories reacted angrily when it emerged that the ad
budget of the Central Office of Information rocketed by 79 per cent from
pounds 59 million to pounds 105.4 million in the 1998/1999 financial
Whitehall estimates show that the budget will now drop to between pounds
90 million and pounds 95 million. The reason is the lower spend on big
campaigns launched in the previous year, such as preparing business for
the single currency and the New Deal programme for the jobless.
However, Whitehall officials believe the drop is a one-off and that
spending will remain broadly in line with this year’s figure over the
next two or three years.
The Tories insisted the ad budget was still at a much higher level than
under John Major’s government.
COI analysis, p14.