Estimates Day debate: Spending priorities and performance of the Department for Work and Pensions

The subject for this debate was selected by the Backbench Business Committee, subject to agreement by the House of Commons. The application for the debate was submitted by Debbie Abrahams MP, the chair of the Work and Pensions Committee.

Following this debate, the House will vote on whether to approve the Main Estimate for the DWP for 2026/27.

This briefing provides information on the DWP’s Main Estimate for 2026/27, including key aspects of DWP departmental spending identified in the Work and Pensions Committee chair’s application for debate.

What are the Estimates?

One of Parliament’s longest standing functions is the consideration and authorisation of the government’s spending plans, requiring the government to obtain parliamentary consent before spending public money. Estimates, sometimes known as Supply Estimates, are the documents presented to Parliament setting out the government’s plans for spending for a given year. The process of obtaining Parliamentary approval to those plans is known as Supply. With a few specific exceptions, the government is required to obtain authority from Parliament through the supply process before it can spend public money.

For more information about the Estimates cycle, see the Library briefing, Main Estimates data: Government spending plans for 2026/27.

Content of an Estimate

Separate Estimates and Votes on Account are produced for each government department and published together by HM Treasury in a single volume. The key components of each Estimate are spending limits and ambits, which in each case apply to a single department for a single year only.

Spending limits

Within each Estimate, spending is divided into a number of distinct budgetary limits for each department, covering spending of a specific type determined by HM Treasury. Changes to the categorisation of spending require prior consultation with Parliament.

Switches of funding are not normally permitted by the Treasury from capital to resource (although exceptions, such as for health, are sometimes made), or from AME to DEL. Once Parliament has voted the limits, savings on any voted limit (DEL or AME) are not permitted to be used in support of spending under another.

Ambits

The ambit is the description of what the spending within each of the limits will be spent upon. Government departments must ensure that their ambits are accurate and, subsequently, that no spending falls outside their scope. Should it do so, it would constitute an ‘excess vote’: illegal spending outside the authority authorised by Parliament.

Detail of spending plans

Further detail of spending plans – breaking them down into a number of lines, known as subheads, within the totals above – is given within each Main and Supplementary Estimate. These breakdowns represent the government’s best estimation of planned spending within the totals at the time the Estimates are prepared, but do not constitute limits within the totals. Government departments are free to switch resources from one subhead to another, providing they do not exceed the overall spending limits, or incur expenditure beyond the scope of the ambit.

Estimates memoranda

Government departments are required to produce an explanatory memorandum to explain the content of each Main and Supplementary Estimate. This memorandum should compare spending plans to previous years and explain the reasons for changes proposed. Select committees currently publish memoranda on their webpages and the Scrutiny Unit uses the memoranda to prepare briefings for select committees and other Members. Departments must submit these memoranda to the relevant House of Commons Select Committee by no later than the publication of the overall Main Estimates.

Department for Work and Pensions Main Estimate 2026/27

The Department for Work and Pensions has submitted its Main Estimate for 2026/27, comprising:

• £13,890.8 million Resource DEL (a 3.3% decrease on 2025/26)
• £999.4 million Capital DEL (a 36.3% increase)
• £328,470.8 million Resource AME (a 6.3% increase)
• £300.3 million Capital AME (a 32.5% decrease).

To mitigate the risk of overspend of demand-led expenditure like Universal Credit and State Pension, the Department agrees a ‘margin’ on top of the forecasted figures for Resource AME and Capital AME. This reflects the uncertainty of demand-led spending, and is accounted for at the Supplementary Estimate. The percentages listed above for RAME and CAME are margin-exclusive; if margin-inclusive figures were used instead for the 2025/26 finalised spending plan, Resource AME would be increasing by 4.2% and Capital AME would be decreasing by 48.8%.

A detailed break-down of the budget movements between years can be found in the Library’s briefing on Main Estimates: Government Spending Plans for 2026/27 and in the DWP’s Estimate Memorandum.