The spending review: The subtle knife IN THE House of Commons on June 26th George Osborne wryly praised Eric Pickles, the rotund communities and local government secretary, for being a "model of lean government." Mr Pickles beamed as the chancellor of the exchequer then announced further cuts to his budget. Other ministers suffered the chop with less grace. But in delivering his spending plans for 2015-16 the chancellor at least hinted at a change in the tilt of his knife. In his first two years in office, Mr Osborne sought to carry out his austerity programme mostly by cutting departmental budgets. They account for about half of all government spending - even if a few, notably health and education, were left largely untrimmed. Thanks to recession, the tab for working-age benefits actually rose. That has begun to change. Child benefit and tax credits peaked in 2011-12, housing benefit in 2012-13 and disability benefit in the current fiscal year. Now the overall bill for working-age benefits is falling; partly thanks to economic recovery, but also to reforms by Mr Osborne. In his 2012 autumn statement, for example, he announced a real-terms cut in payment levels. In his latest spending review he went further, unveiling a cap on over £100 billion ($153 billion) of welfare payments from 2015. The only exceptions will be counter-cyclical benefits, such as unemployment support, which helps sustain demand when the economy slows - and pensions, which are shielded by the mighty grey vote. Mr Osborne also announced that the unemployed will have to wait a week before they can claim benefits. Such money-saving measures should ameliorate further cuts to departmental budgets. Partly, this is the brute reality of saving money. Emaciated departments and services offer ever-fewer opportunities to do so without sparking political battles. And transfers inspire little of the public affection that institutions do; a recent poll suggested state spending on affordable child care is twice as popular as spending on child benefit and child tax credits. Cash handouts are an obvious target for Mr Osborne, that most tactical of contemporary British politicians. But in setting his sights on them, he also doffs his cap to policy wonks. In public-policy circles in each of the main parties, the talk since the 2010 election has been of the limits of cash transfers as a means of solving society's problems. The last Labour government used them as a sort of spackle, smoothing over fractures but not always curing underlying problems. Services (which fall under the budgets of government departments) are a better way of helping people, reckon think-tankers. They contend that money is often less helpful than knowledge, opportunities and places where folks can exchange advice with their fellow citizens. In the Conservative camp, the work and pensions secretary, Iain Duncan Smith, is a leading exponent of this view. Giving people just enough to stay out of indigence - what he calls "poverty plus a pound" - inspires sloth and dependency, he believes. Tough love and advice from job centre advisers, on the other hand, help the workless to help themselves. In the Labour camp, too, many question the merits of cheques in the post. Thinkers such as Marc Stears, an influential don who rejects the old "redistribution-driven" policies of the past, have inspired the party's decision to commit to a benefits cap of its own. The cumulative effect of these spending changes - motivated as much by political pragmatism as by principle - is to shift the burden of deficit reduction away from departmental services and onto cash transfers, tilting the somewhat depleted resources of the British state in favour of the former. Matthew Whittaker of the Resolution Foundation, a think-tank, says that by 2016 reductions in cash payments should have overtaken cumulative cuts to ministerial budgets. What looks like an accounting quirk in fact illustrates the evolving ideal of the British state, which is beginning to look less like Robin Hood and more like Mother Teresa. Britain's decade of austerity will certainly leave it leaner - but, relative to its size, it could leave it more hands-on, too.