Main Estimates: Government spending plans for 2022/23

What are Estimates?

One of Parliament’s longest-standing functions is the consideration and authorisation of government’s spending plans, requiring the government to obtain parliamentary consent before spending public money. Main Estimates are the documents that contain the detail of those spending plans for a particular year. There is a separate Estimate for each Government Department. Changes are presented at the end of each year through Supplementary Estimates.

Each of the Estimates must be authorised by Parliament before they take effect. In the early part of the year, funding is provided via an advance of 45% of last year’s approved spending, through what is known as the Vote on Account.

What has changed since last year?

Spending Plans for 2022/23, as set out in the Spending Review 2021, are no longer intended to include any ring-fenced spending for Covid-19. Largely because of this, planned spending by departments in the 2022/23 Main Estimates is set to fall significantly compared to the final budgets published for 2021/22 in last year’s Supplementary Estimates. This is driven by day-to-day spending, as overall investment spending is planned to increase. Despite the reduction, overall spending is still significantly higher when compared to 2019/20, when there was little Covid-19 spending.

Notable spending changes compared to last year include:

• Health spending decreases significantly, driven by a reduction in Covid-19 spending of around £39 billion;
• £15 billion spending announced on 26 May to support households facing cost-of-living increases. This is largely on payments for households to reduce energy bills (BEIS), and additional payments for those receiving means-tested benefits, winter fuel allowance, or tax credits (DWP and HMRC). Incorporating these changes required the Government to re-lay the Estimates before Parliament, having originally laid them on 12 May;
• Local government spending is reduced, mainly reflecting around £12 billion of spending last year related to Covid-19 and the £150 council tax rebate – although this is partially offset by increased investment in home-building; and
• Devolved administration’s funding is affected by many of the reductions in departmental spending, and as a result Scotland, Wales and Northern Ireland see slightly lower levels of funding from the UK Government this year.

Parliament’s role in considering Estimates

Before the latest Main Estimates can be approved, Estimates day debates will take place on the floor of the House of Commons. Any backbench member may bid for a topic for one of these debates, which should be linked to the spending, or an aspect of spending, contained in the Main Estimate of a department or other body.

The deadline for debate applications this year was 24 June, a day after the Estimates were re-laid. The Backbench Business Committee considered bids for debates at a meeting on 27 June, and decisions were announced in that week’s Business Statement. Two days of debates on the Main Estimates are expected to occur on 5 and 6 July 2022, as follows (with links to the Library’s debate pack for each one):

• Tuesday 5 July:
  • Department for Work and Pensions (spending on the cost of living measures)
  • BEIS (spending on action on climate change and decarbonisation)
  • Wales Office (spending on measures to support the Welsh economy, and its consequences for the devolved institutions)
• Wednesday 6 July
  • Department for Education
  • FCDO (spending on the strategy for international development)

Following the debates, the House is 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 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 are able to draw upon the agreed funds set out in the Act for the purposes Parliament has authorised. Advances from the Contingencies Fund are repaid.