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Spending Review: What is it?

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On Wednesday 25 November the government will announce the details of its Spending Review and Autumn Statement in a combined statement to Parliament.

It's the third major economic statement this year - after the Budget in March and the post-election Summer Budget in July.

But what's the difference between them?

Let's start with the Spending Review...

The Spending Review is intended to give a five-year view of the government's spending plans. It looks at the budgets of all the government departments. In effect, it will decide how £4 trillion of taxpayers' money will be spent by setting the maximum amount that the different departments can spend.

This year deep spending cuts are expected as Chancellor George Osborne tries to balance the books.

And how often do they happen?

Whenever the government deems it necessary. The last one was in 2013.

They were first introduced in 1998 when Gordon Brown was chancellor and they aimed to give a longer term view of the spending plans.

Previously departmental spending plans were set out annually.

And what about the Autumn Statement?

It's still happening as usual and will be included in the chancellor's speech.

That means he will update MPs on the government's taxation and spending plans, based on the economic projections provided by the Office for Budget Responsibility (OBR) - a body set up in 2010 to provide independent economic forecasts.

Normally, it doesn't include an overall review of all the departments' spending as in the Spending Review, but you may get policy changes to the individual departments.

The OBR publishes its estimates for the country's economic growth and the government's finances as soon as the chancellor finishes making his speech.

But that sounds like the Budget?

Yes, it's not that different. Traditionally the Budget in March was when the government announced its new tax plans, but that's not really the case any more. They are often announced in the Autumn Statement now as well.

Spending Review 2015 - 25 November

The Spending Review is a five-year projection of government spending. In effect, it decides how £4 trillion of taxpayers' money will be spent by setting caps on government departments. Deep spending cuts are expected as Chancellor George Osborne seeks to balance the books.

Explained: Which government departments will be affected?

Analysis: Latest from BBC political editor Laura Kuenssberg

More: BBC News Spending Review special report


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