9 October 2007

103/07

Public Expenditure Annual Outturns - National Statistics release 9 October 2007

Updates for 2006-07 and earlier years for key series

This release provides new estimates of financial year outturns for some key public expenditure series that are compiled and published by HM Treasury as National Statistics.

New estimates of outturn are being released for five series:

Table 1 – Total Managed Expenditure, by budgetary category, up to 2006-07;
Table 2 – Resource Departmental Expenditure Limits, by departmental grouping, up to 2006-07;
Table 3 – Near-cash Resource Departmental Expenditure Limits, by departmental grouping, up to 2006-07;
Table 4 – Capital Departmental Expenditure Limits, by departmental grouping, up to 2006-07;
Table 5 – Total Expenditure on Services by function, 2002-03 to 2006-07, with a link to the historical series 1987-88 to 2006-07.

The data included in this release update the National Statistics release published alongside the Public Expenditure Outturn White Paper 2007 on 19 July 2007.

Presentational Changes

This release contains a number of presentational changes from the previous National Statistics release.

Table 1 now splits AME (Annually Managed Expenditure) spending into resource and capital, and therefore shows more transparently how public sector current and capital expenditure is derived from budgets.

Tables 2, 3 and 4 have been changed:

to reflect Machinery of Government changes announced during the summer;
to separately identify the spending of independent bodies, previously presented as part of the Cabinet Office or Chancellor's Departments groupings. This includes the Statistics Board, House of Commons, House of Lords, National Audit Office and the Office of the Parliamentary Commissioner;
to show the Charity Commission as part of the Cabinet Office rather than Home Office group, reflecting the new ministerial responsibilities.

Public Expenditure by budgetary category

Total Managed Expenditure for 2006-07 is now estimated at £550.1 billion, £0.3 billion less than the July 2007 estimate of £550.4 billion.

Total Departmental Expenditure Limits (Resource DEL plus Capital DEL less depreciation) spending in 2006-07 is now estimated at £320.4 billion, £0.1 billion higher than the estimate of £320.3 billion in July. Resource DEL (including depreciation), at £291.2 billion, is £0.8 billion lower than the £292.0 billion July estimate. These changes reflect the availability of audited outturn for some departments, replacing provisional outturn published in July. Further audited outturn will become available prior to the next National Statistics release published alongside Budget 2008.

Total Managed Expenditure in 2006-07 – Comparison with July 2007

2006-07 £billion

	Resource DEL¹	Capital DEL	Depreciation in DEL	Total AME²	TME³
9 October 2007	291.2	39.1	9.9	229.7	550.1
19 July 2007	292.0	38.3	10.0	230.0	550.4

¹ Including depreciation
² Total AME is Departmental AME, Other AME and accounting adjustments
³ TME = Resource DEL + Capital DEL – depreciation in DEL + Total AME

These latest figures, including DEL by departmental grouping and public expenditure by function, will be available to download on the Treasury website tomorrow from the Overview of definitions, processes and data page.

Public Expenditure by function

Public spending by function includes spending by departments, the devolved administrations, local authorities and the capital spending of public corporations.

An historical public expenditure by function series was published in table 4.2 of PESA 2007, including data from 1987-88 onwards. Latest estimates of public expenditure by function and the historical data are available in PDF format. These data will be available tomorrow, to download as a consistent series, from the Functional categories page of the Treasury website.

Data Quality

The system used by central government departments and devolved administrations to report expenditure data is being replaced by a new system, the Combined On-line Information System (COINS). Migration of data to COINS started in mid-2005. During the transition period the quality of some data may be affected, which may lead to larger than usual revisions of the data published in this spending update in Budget 2008.

Table 1⁽¹⁾: Total Managed Expenditure, by budgetary category, 2002-03 to 2006-07

					£ million
	National Statistics
	2002-03	2003-04	2004-05	2005-06	2006-07
	outturn	outturn	outturn	outturn	outturn
CURRENT EXPENDITURE
Resource Departmental Expenditure Limits	229,707	244,920	258,633	277,374	291,192
of which:
Near-cash Departmental Expenditure Limits	204,787	228,934	244,661	259,369	272,322
Non-cash	24,920	15,986	13,973	18,005	18,870

Resource Annually Managed Expenditure	163,671	180,409	197,797	207,179	215,447
of which:
Social security benefits	113,850	118,080	125,287	129,858	133,924
Tax credits⁽²⁾	5,741	9,727	11,601	12,972	14,189
Net public service pensions⁽³⁾	4,150	1,796	352	3,681	3,713
National lottery	681	717	665	841	843
BBC domestic services	2,464	2,383	2,418	2,502	2,652
Student loans	-115	-203	-272	-352	-407
Non-cash items	27,760	26,939	27,297	31,440	38,458
Other departmental expenditure	2,056	2,299	1,810	2,736	3,338
Net expenditure transfers to EC institutions⁽⁴⁾	2,782	3,448	4,907	4,435	4,652
Locally-financed expenditure	23,001	22,547	23,685	25,360	25,485
Central government gross debt interest	20,912	22,277	23,931	25,790	27,572
Accounting adjustments	-39,610	-29,600	-23,884	-32,084	-38,972
Public sector current expenditure	393,378	425,329	456,430	484,553	506,639


CAPITAL EXPENDITURE
Capital Departmental Expenditure Limits	27,076	30,484	32,838	35,176	39,080

Capital Annually Managed Expenditure	584	-401	2,925	4,475	4,384
of which:
National lottery	1,121	1,193	1,039	988	828
BBC domestic services	112	-6	78	94	84
Student loans	2,303	2,314	2,261	2,419	3,208
Other capital expenditure	-199	-478	385	385	-571
Locally-financed expenditure	978	746	2,399	4,268	5,063
Public corporations' own-financed capital expenditure	3,271	2,255	2,725	5,119	5,710
Accounting adjustments	-7,002	-6,426	-5,962	-8,798	-9,937
Public sector gross investment	27,660	30,083	35,763	39,651	43,464
less Public sector depreciation	-13,982	-14,623	-15,259	-16,236	-17,178
Public sector net investment	13,678	15,460	20,504	23,415	26,286

TOTAL MANAGED EXPENDITURE	421,038	455,412	492,193	524,204	550,103
of which:
Departmental Expenditure Limits	241,253	266,770	283,628	303,014	320,396
Annually Managed Expenditure	179,785	188,642	208,565	221,190	229,707

(1) Update of PESA 2007 Table 1.1 outturns

(2) Tax credits include working tax credits, stakeholder pension credits and, from 2003-04, Child Tax Credits. From 2003-04 to 2006-07, the Child Tax Credits do not include those child allowances that were still paid as part of Income Support and Jobseekers' Allowance, within Social Security benefits.

(3) The main pensions schemes are reported under FRS17 accounting requirements.

(4) Net expenditure transfers to the EC are comprised of the GNI-based contribution to the EC less the UK's abatement. Latest estimates (in £ billion) are given below for net payments to EC institutions and the UK's net contribution to the EC budget, as defined in annex C of Public Expenditure Statistical Analyses (PESA).

	2005-06	2006-07
Net payments to EC Institutions	3.7	2.9
UK's net contributions to the EC budget	4.4	3.5

Table 2⁽¹⁾ Resource Departmental Expenditure Limits, by departmental grouping, 2002-03 to 2006-07

					£ million
	National Statistics
	2002-03	2003-04	2004-05	2005-06	2006-07
	outturn	outturn	outturn	outturn	outturn
Resource Budget DEL
Children, Schools and Families	10,652	11,976	12,640	14,373	42,182
Health	57,115	63,605	69,118	76,372	80,344
of which: NHS (England)	55,405	61,865	66,873	74,168	78,387
Transport	4,781	6,114	6,085	6,076	6,920
Innovation, Universities and Skills	11,392	12,207	12,603	13,673	14,324
CLG Communities	1,614	3,415	3,606	3,472	3,617
CLG Local Government	37,396	40,915	43,316	46,244	22,541
Home Office	7,338	7,940	8,005	8,330	8,373
Justice	8,073	7,473	7,539	7,987	8,355
Law Officers' Departments	514	576	646	689	698
Defence	36,495	31,402	31,327	33,318	33,513
Foreign and Commonwealth Office	1,476	1,509	1,708	1,874	1,825
International Development	3,001	3,447	3,645	4,107	4,212
Business, Enterprise and Regulatory Reform	1,637	1,725	2,136	1,996	2,227
Environment, Food and Rural Affairs	2,242	2,443	2,814	2,817	3,202
Culture, Media and Sport	1,227	1,225	1,326	1,452	1,520
Work and Pensions	6,849	7,621	7,773	7,775	7,615
Scotland	16,246	18,421	19,458	20,790	22,376
Wales	8,887	9,642	10,379	10,986	11,641
Northern Ireland Executive	5,767	5,973	6,382	6,726	7,088
Northern Ireland Office	1,096	1,044	1,150	1,176	1,224
Chancellor's departments	4,041	4,284	4,603	4,781	4,955
Cabinet Office	1,215	1,288	1,634	1,533	1,699
Independent Bodies⁽²⁾	654	676	742	827	739
Total Resource Budget DEL	229,707	244,920	258,633	277,374	291,192

(1) Update of PESA 2007 Table 1.5 Resource DEL outturns

(2) Independent bodies within Departmental Expenditure Limits that are not settled as part of the Comprehensive Spending Review. Includes the Statistics Board, House of Commons, House of Lords, National Audit Office and the Office of the Parliamentary Commissioner.

Table 3⁽¹⁾ Near-cash elements of Resource Departmental Expenditure Limits, by departmental grouping, 2002-03 to 2006-07

					£ million
	National Statistics
	2002-03	2003-04	2004-05	2005-06	2006-07
	outturn	outturn	outturn	outturn	outturn
Near-cash in Resource DEL
Children, Schools and Families	10,653	11,959	12,618	14,325	42,181
Health	54,577	61,299	68,916	74,320	77,665
of which: NHS (England)	52,878	59,568	66,688	72,132	75,724
Transport	4,453	5,902	5,919	5,813	6,363
Innovation, Universities and Skills	10,472	11,238	11,722	12,561	13,298
CLG Communities	1,616	3,420	3,545	3,437	3,467
CLG Local Government	37,395	40,914	43,314	46,244	22,540
Home Office	7,188	7,850	7,923	8,212	8,214
Justice	6,611	7,220	7,775	7,817	8,043
Law Officers' Departments	510	571	636	680	691
Defence	20,014	21,385	21,858	22,693	23,474
Foreign and Commonwealth Office	1,330	1,402	1,599	1,704	1,678
International Development	2,843	3,423	3,541	4,041	4,108
Business, Enterprise and Regulatory Reform	1,634	1,764	1,955	1,782	2,056
Environment, Food and Rural Affairs	1,945	2,201	2,466	2,349	2,567
Culture, Media and Sport	1,078	1,084	1,197	1,299	1,351
Work and Pensions	6,694	7,542	7,685	7,563	7,336
Scotland	15,583	17,889	18,481	19,975	21,402
Wales	8,517	9,415	10,085	10,661	11,322
Northern Ireland Executive	5,504	5,806	6,202	6,503	6,816
Northern Ireland Office	917	935	905	974	1,012
Chancellor's departments	3,739	4,139	4,353	4,534	4,688
Cabinet Office	1,016	1,064	1,412	1,316	1,463
Independent Bodies⁽²⁾	498	512	553	568	586
Total near-cash in Resource DEL	204,787	228,934	244,661	259,369	272,322

(1) Update of PESA 2007 Table 1.7 near-cash Resource DEL outturns

Table 4⁽¹⁾ Capital Departmental Expenditure Limits, by departmental grouping, 2002-03 to 2006-07

					£ million
	National Statistics
	2002-03	2003-04	2004-05	2005-06	2006-07
	outturn	outturn	outturn	outturn	outturn
Capital Budget DEL
Children, Schools and Families	2,736	3,471	4,070	4,413	4,052
Health	2,146	2,689	2,708	2,245	3,325
of which: NHS (England)	2,073	2,602	2,624	2,151	3,200
Transport	5,059	5,233	5,223	4,999	6,505
Innovation, Universities and Skills	1,102	1,297	1,429	2,006	1,882
CLG Communities	3,057	4,597	4,984	5,531	5,437
CLG Local Government	202	214	257	316	223
Home Office	656	681	589	628	593
Justice	363	364	599	508	535
Law Officers' Departments	8	11	11	-23	11
Defence	6,115	6,002	6,701	6,410	7,070
Foreign and Commonwealth Office	102	87	117	132	160
International Development	448	302	304	447	760
Business, Enterprise and Regulatory Reform	268	445	220	1,124	1,125
Environment, Food and Rural Affairs	432	567	489	836	933
Culture, Media and Sport	28	124	154	115	333
Work and Pensions	281	222	290	354	215
Scotland	1,906	1,697	2,171	2,390	3,035
Wales	1,004	985	1,008	1,208	1,346
Northern Ireland Executive	663	618	767	835	798
Northern Ireland Office	53	50	71	59	69
Chancellor's departments	246	229	380	369	302
Cabinet Office	174	569	195	228	308
Independent Bodies⁽²⁾	28	33	102	44	61
Total Capital Budget DEL	27,076	30,484	32,838	35,176	39,080

(1) Update of PESA 2007 Table 1.10 Capital DEL outturns

Table 5⁽¹⁾ Total Expenditure on Services by function, 2002-03 to 2006-07

					£ billion
	National Statistics
	2002-03	2003-04	2004-05	2005-06	2006-07
	outturn	outturn	outturn	outturn	outturn
1. General public services	36.2	39.1	42.7	45.7	48.0
of which: domestic general public services	10.0	10.9	12.2	12.9	13.2
of which: international services	4.5	5.1	5.5	6.1	6.1
of which: public sector debt interest	21.7	23.0	24.9	26.7	28.6
2. Defence	27.1	28.9	30.0	30.7	32.3
3. Public order and safety	24.2	26.3	28.3	29.0	30.2
4. Economic affairs	30.7	32.9	33.6	35.2	38.6
of which: enterprise and economic development	5.9	5.9	6.5	6.5	7.0
of which: science and technology	2.1	2.3	2.5	3.0	2.8
of which: employment policies	3.0	3.2	3.2	3.4	3.5
of which: agriculture, fisheries and forestry	4.9	5.2	5.4	5.6	5.1
of which: transport	14.8	16.2	16.0	16.8	20.2
5. Environment protection	6.1	6.3	7.0	8.5	9.4
6. Housing and community amenities	5.4	6.6	7.9	10.5	11.2
7. Health	66.3	74.9	82.8	88.9	94.6
8. Recreation, culture and religion	9.3	9.6	10.0	10.6	11.3
9. Education (includes training)	54.3	60.4	64.6	69.4	72.7
of which: education	52.5	58.4	62.6	67.2	70.5
of which: training	1.9	2.0	2.0	2.2	2.2
10. Social protection	145.3	155.4	164.0	170.9	176.9
EC transactions	-1.9	-2.1	-0.9	-0.6	-1.8
Total Expenditure on Services	403.0	438.2	469.9	498.9	523.3
Other accounting adjustments	18.0	17.2	22.3	25.3	26.8
Total Managed Expenditure	421.0	455.4	492.2	524.2	550.1

(1) Update of PESA 2007 Table 4.2

Notes to editors

Background

1. These data are being released in accordance with the National Statistics Code of Practice, and with the Treasury's statement of compliance with the Code's protocol on release practices, available on the Treasury website

Budgetary data (Tables 1, 2, 3, and 4)

2. Presentation of public expenditure in tables 1, 2, 3 and 4 follows the Treasury's budgeting and control framework, which splits spending into Resource Budgets and Capital Budgets. These Budgets are split into Departmental Expenditure Limits (DEL) and Annually Managed Expenditure (AME). DELs are firm three year spending limits set for departments. Spending that cannot reasonably be subject to firm multi-year limits is included in AME. DEL and AME together make up Total Managed Expenditure (TME), an aggregate that is drawn from the national accounts and is defined in national accounts terms as public sector current expenditure plus public sector capital expenditure.

Spending by Function (Table 5)

3. Data on public spending by function is published annually in the Public Expenditure Statistical Analyses. The spending aggregate allocated by function is Total Expenditure on Services (TES), which is based on Total Managed Expenditure (TME), as far as this can be derived in detail from data held on the Treasury's public expenditure database. The allocation of spending to function in TES is broadly consistent with the UN Classifications of the Functions of Government. All data is UK, with spending by devolved administrations being allocated to function as appropriate. Further information on the HM Treasury functional analyses is available on the Treasury website

Sources and methodology

4. Treasury statistics on public expenditure compiled from accounting data supplied by central government departments and the devolved administrations and held on the Treasury's public expenditure database - COINS. The Department for Schools, Children and Families supplies data on local authority spending in England on education. In addition, the Department for Work and Pensions supplies data on local authority spending on social protection. All other data on local authority spending are supplied by the Department for Communities and Local Government (DCLG) and the Devolved Administrations. The spending aggregate, TME, was supplied by the Office for National Statistics (ONS) and is consistent with the joint ONS/HMT Monthly Public Sector Finance Statistics release on 24 September 2007.

5. There is more information on the budgeting system and the definition of TES in PESA 2007 in Appendices D and E respectively.

A National Statistics publication

6. Most public expenditure outturn data published by HM Treasury are published as National Statistics. National Statistics are the official source for authoritative, accurate and relevant information on the economy and society. The release of data in this press notice has followed the National Statistics Code of Practice and Protocol of Release Practices.

Enquiries

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