The latest Spending Review straddles the date of the next general election
Chancellor George Osborne is to set out where a further £11.5bn of government cuts will come from, when he lays out his Spending Review later.
Most Whitehall departments face budget reductions of 8% to 10% in 2015-16, but health and schools in England and the overseas aid budget are ring-fenced.
The government says it has made good progress in cutting the budget deficit and that further savings are necessary.
But Labour says the coalition's economic plan has failed.
Mr Osborne will outline the Spending Review, covering the 2015-16 financial year, in the House of Commons from 12:30 BST.
Intelligence winnersBBC political editor Nick Robinson says there will be no fresh welfare cuts, but there will be more detail of a long-term plan to cap much welfare spending and a move to limit the payment of winter fuel allowance paid to pensioners who live abroad.
This was a day that was not in the chancellor's original plan. The age of austerity was scheduled to end before the next election and, with it, cuts to public spending.
However, the failure of the economy to grow and the deficit to carry on shrinking has forced George Osborne to announce a new round of cuts to begin a month before the next election in 2015.
After months of negotiations we will learn today which Whitehall departments - if not which precise programmes - are the losers, which the heavy losers and which will simply stand still.
Spending on the NHS, schools and overseas aid will continue to be protected and the intelligence services will be one of the few winners of a spending increase, he adds.
The next general election is scheduled for May 2015 and the Conservative-Liberal Democrat coalition has to set out its budgetary plans for the final few weeks of its time in office, irrespective of the outcome of the poll.
Labour has said that it would match the coalition's current spending totals for the full one-year period.
On Sunday, Mr Osborne announced that the Ministry of Defence would have to shed civilian staff, but the UK's military capacity would not be affected.
The last department to reach a settlement on its budget was Vince Cable's Department for Business and Skills.
The agreements followed weeks of arguments with ministers.
“Start Quote
End QuoteDespite the many thousands of words that will appear in election manifestos in the months ahead, the hard numbers of this week's Spending Review will tell a more compelling story”
The chancellor had initially hoped to eliminate the structural deficit - the portion of borrowing that is not affected by changes in the economic cycle - entirely by 2014-15.
But the timeframe for this has slipped to 2017-18 and Mr Osborne will have to borrow £275bn more than he expected in this parliament than at the time of his first Budget in 2010.
The government says it has cut overall borrowing by a quarter since coming to power and by a third as a share of GDP.
Revised official figures released on Friday showed that borrowing rose slightly to £118.8bn in 2012-13 from £118.5bn the year before.
'Out of intensive care'Mr Osborne has indicated the coalition is determined to stick to its austerity plan, saying: "I'm confident we are coming out of intensive care and we can turn this country around. There's certainly a chance of a relapse if we abandon our plan."
But shadow financial secretary to the Treasury Chris Leslie said: "This Spending Review is happening because David Cameron and George Osborne's economic plan has failed.
What is the Spending Review?
- Government departments set out spending for set period of time
- George Osborne needs to find £11.5bn in savings
- The 2015-16 timetable is designed to last a little while beyond the next general election
"Three years of falling living standards and a flat-lining economy has led to billions more borrowing to pay for economic failure. Far from balancing the books by 2015, as the government promised, the chancellor is being forced to make even more cuts."
Ministers will also set out plans to invest billions of pounds in transport, science and other capital projects on Thursday.
Source: BBC News - Business http://www.bbc.co.uk/news/uk-politics-23053693#sa-ns_mchannel=rss&ns_source=PublicRSS20-sa
