Revised Government spending plans for 2018/19

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.

A previous library briefing paper, Main estimates: Government spending plans for 2018-19, set out details of the initial spending plans of the government for the current financial year. As is usual, the government has now published its proposals to amend those plans, in the Supplementary Estimates, which require the approval of Parliament in order to come into effect.

Backbench members can submit bids to the House’s Backbench Business Committee for debates on public spending – known as Estimates day debates – on each occasion Estimates are presented to Parliament. The latest opportunity for debates, linked to the Supplementary Estimates, arises on 26 February 2019.

Spending topics selected for debate must relate to the spending included in an Estimate or Estimates. Following the debates, motions are put to the House to agree those Supplementary Estimates which form the subjects of debate, followed by a single “roll-up” motion to agree all the remaining Supplementary Estimates.

Overall, in this year’s supplementary estimates, the government proposes to increase Departmental Expenditure Limits for day-to-day spending by £16.9 billion (+5.9%), and investment spending by £2.5 billion (+4.6%), compared to the Main Estimates. However, most of this extra money has either already been announced in the Chancellor’s previous Budgets, or is taken from the Treasury Reserve. This means that most additional spending included in the Supplementary Estimates has already been factored into overall spending forecasts, even though Parliamentary approval has yet to be given.

Among notable changes proposed in the Supplementary Estimates are:

• An extra £2 billion for health, £0.8 million of which is for the recent pay award (already announced), with additional cover for in- year pressures and increases in costs of personal injury claims. £0.5 billion is to be switched from capital to day to day budgets- the fifth successive year such switches have taken place;
• £1.5 billion extra for Brexit preparations, from the Treasury Reserve. Four departments- Home Office, DEFRA, HMRC and BEIS- absorb two thirds of this money. While the government announced access to proposed allocations of extra funds for Brexit for 2018-19 last March, amounts are only now being allocated to departments, and in some cases the amounts have altered from the amounts previously announced;
• Over £1 billion extra for justice, to meet a number of spending pressures and priorities including probate, legal aid, prisons, probation and courts;
• Extra funding for transport, split between day-to-day spending and investment. This will cover lower than expected income from passenger rail services, increased costs of Crossrail, HS2 VAT liabilities and, as announced in the Budget, extra funds for local roads maintenance;
• £0.4 billion extra for school equipment and facilities, as announced in the last Budget;
• £0.3 billion extra for international development, in line with the commitment to spend 0.7% of gross national income on aid;
• Adjustments to budgets for devolved administrations, to give funding equivalent to that being spent by UK departments in non-devolved areas, as well as some specific additional funds such as Fresh Start and City Deals;
• Savings on the capital housing budget, much of which is carried forward to future years.