Revised Government spending plans for 2017-18

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 note set out changes that are taking place to the debates associated with Estimates- the Estimates Day Debates. From now on, any backbench Member can submit a bid to Backbench Business Committee for a debate on public spending for one of these debates.  Debate bids should relate to issues related to public spending included in Estimates.

The first allocation of debates follows the publication of the 2017-18 Supplementary Estimates on 7 February 2018.

This note gives details of the content of the 2017-18 Supplementary Estimates – the changes the government proposes to current year Departmental budgets.

Among notable changes proposed are:

• An increase of just over £2 billion (1.7%) in current spending for health, partly funded through a reduction of £0.5 billion (-8%) in investment health funding;

• Over £280 million on spending on Brexit related matters, distributed across a number of government departments;

• Extra money from Treasury’s Reserve for a number of departments, including for defence operations and peacekeeping, to underwrite the costs of Carillion’s receiver, for asylum support and counter terrorism, for the repatriation costs following the Monarch airlines collapse, for potential HS2 VAT costs, for the court reform programme and a shortfall in probate income, for costs following the reversal of an increase in mobile licence fees, and for costs following delays in introducing an exemption scheme for energy intensive industries;

• Mainly as a result in changes in long term discount rates, the costs of future liabilities for nuclear decommissioning, defence, health and environment rise. The estimate of impairment charges (reductions in estimated value) of the student loan book also rises, reflecting revised macroeconomic forecasts;

• The cash block grant to Scotland and Wales rises, and Northern Ireland’s falls, but the underlying Departmental Expenditure Limits of all three – representing actual spending power – rises as a result of the Barnett formula and other changes (including the first tranche of £20 million under the confidence and supply agreement between Government and DUP);

• A number of departments are surrendering funds – in many cases to enable them to draw upon the funds instead in subsequent years.