Revised Government spending plans for 2024/25

What are 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. These are presented to Parliament in documents known as “Estimates”.

A previous Library briefing paper set out details of the government’s initial spending plans (published in July 2024 for the Main Estimates 2024/25) for the current financial year.

Estimates typically take place twice per financial year:

• May to June: Main Estimates (initial departmental spending plans)
• February to March: Supplementary Estimates (revised final departmental spending plans)

What are Supplementary Estimates?

Supplementary Estimates show the changes to this financial year’s budgets which the government is seeking for each department. They are divided into separate limits for the following categories:

• current, day-to-day spending (also known as resource): this is spending on staff and other running costs, on goods and services and grants
• capital (investment) spending: this is spending covering the purchase and sale of assets, loans and capital grants.

The changes are then further divided into two more categories:

• Departmental Expenditure Limits (DEL): spending subject to fixed limits, based broadly on the plans outlined for 2024/25 in the 2024 Spending Review and Autumn Budget
• Annually Managed Expenditure (AME): less predictable and more demand-led spending.

Changes to the cash block grants proposed to Scotland, Wales and Northern Ireland are also included under a separate heading.

As is usual, all these changes these will be put to Parliament for approval in March, and if Parliament is content, they will be given legal effect by a new Supply and Appropriation Act before the end of the financial year, allowing access to additional funds approved.

What has changed compared with the initial 2024/25 budget?

The Supplementary Estimates contain requests for additional spending (relative to the initial budgets for this year) that amount to the following totals:

• Resource DEL rises from £488.3 billion to £535.0 billion (+9.6%)
• Capital DEL rises from £113.8 billion to £114.6 billion (+0.1%)
• Resource AME rises from £503.6 billion to £569.5 billion (+13.1%)
• Capital AME falls from £99.3 billion to £74.0 billion (-25.5%)

The changes contained in this Supplementary Estimate broadly track spending announced as part of the Autumn Budget 2024. The Main Estimates approved by the government earlier in the year had been largely based on the plans of the previous government, and so the 2024/25 Supplementary Estimates represent the first full spending plans for the new Labour government.

As expected, there were significant increases in funding in areas such as health, defence and regional development. There were a number of significant cross-government spending pressures reflected in the Estimates, such as compensation payments and support for Ukraine. The Official Development Assistance (ODA) budget used for domestic purposes – largely asylum support – remains significant. In recent years large amounts of ODA have been spent in the UK rather than overseas (see Commons Library research briefing The UK aid budget and support for refugees in the UK, 2022 to 2024).

Parliament’s role in considering Estimates

Before the Supplementary Estimates can be approved, Estimates Day debates will take place in the Chamber of the House of Commons. Any backbench member is able to bid for a topic for one of these debates, which should be linked to the spending, or an aspect of spending, contained in the Supplementary Estimate of a department or other public body.

Following the debates, the House will be invited to agree motions on those Estimates selected for debate. Members may agree or reject these motions or suggest amendments reducing expenditure. There is a further ‘roll up motion’ covering the remaining Estimates, which members may accept or reject. Under the ‘Crown prerogative’, only the government can propose spending, so amendments to increase spending are not permitted.

Once motions have been authorised, a Supply and Appropriation bill is presented. Unlike most bills there is no committee stage, and as with other financial legislation the House of Lords’ role is purely formal. On receiving Royal Assent, departments will be able to draw upon the agreed funds set out in the Act for the purposes Parliament has authorised, and advances from the Contingencies Fund will be repaid.