Below is the text of Mr Major’s written Parliamentary Answer on Government Expenditure on 22nd April 1988.
Mr. Allen To ask the Chancellor of the Exchequer what percentage of Government spending is cash limited, and what are the main categories which are not.
Mr. Major Some £63 billion – just over 40 per cent. of the 1988–89 public expenditure planning total of £156.8 billion – is covered by cash limits. In addition, a further £12 billion of expenditure, which mostly finances expenditure included in the planning total, is covered by cash limits. The main categories which are not subject to cash limits are demand-led services (such as supplementary benefits, where once policy and rates of payments have been determined expenditure depends on factors such as the number of claimants coming forward), local authority current expenditure (although most central Government grants to local authorities are covered by cash limits) and the financing of most public corporations (nationalised industries are subject to external financing limits). The coverage of cash limits is discussed more fully in chapter 3 of the “Supply Estimates 1988–89: Summary and Guide” (Cm 328).
Mr. Allen To ask the Chancellor of the Exchequer what percentage of Government spending is voted by Parliament; and what are the main categories of expenditure outside this.
Mr. Major The 1988–89 main Supply Estimates seek parliamentary authority for some £83 billion – just over 50 per cent. of the 1988–89 public expenditure planning total of £156.8 billion. In addition a further £25 billion of expenditure in 1988–89 main Estimates will finance payments to bodies whose own expenditure is counted in the planning total. The main categories of expenditure not voted by Parliament are local authority expenditure (although central Government grants to local authorities are included in Supply Estimates), social security expenditure financed directly from the national insurance fund, some payments made direct from the Consolidated Fund, such as contributions to the European Community, and net borrowing by most public corporations. These relationships are set out more fully in the “Supply Estimates 1988–89: Summary and Guide” (Cm 328).