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The government published its plans for day-to-day spending in the spring budget in March
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But when I arrived at the Treasury on the very first day, I was alerted by officials that this was not how much the previous government expected to spend this year
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It wasn't even close. In fact, the total pressures on these budgets across a range of areas
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was an additional £35 billion. The new Chancellor Rachel Reeves has announced spending cuts worth $5.5 billion
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as the new government seeks to address a 22 billion black hole in the public finances
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Chancellor Rachel Reeves yesterday announced spending cuts worth 5.5 billion as a new government seeks to address a 22 billion black hole in the public finances
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Here's everything you need to know about the Chancellor's statement to the House of Commons on Monday
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When entering office, Rachel Reeves commissioned an internal treasury audit on the state of the public finances
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Her speech in Parliament yesterday revealed the results of that review, finding there is expected to be a roughly 22 billion overspend on departmental budgets this year
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Thus compared to the spending envelopes laid out in this year's spring budget
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The Conservatives dispute this claim with former Chancellor Jeremy Hunt suggesting the 22 billion figure was nonsense So what going on The figure includes unfunded commitments from the previous government such as 6 billion for asylum seekers and nearly 3 billion to support railway companies
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But it also contains funding for generous pay rises for workers across the public sector
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including a 22% pay rise for junior doctors. The public sector pay rise, agreed by this government
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cost over 9 billion, making up a large portion of the so-called black hole
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Reeves claimed the last government set the remit for the public sector pay bodies without giving guidance on what was affordable
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To help plug the gap, Reeves announced spending cuts worth 5.5 billion, bringing in-year funding pressures down to just over 16 billion
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The Chancellor announced plans to introduce means testing on winter fuel payments, so only those receiving pension credit or means-tested benefits will be eligible for the payment, saving $1.4 billion this year
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Reeves also pledged that in future the government would hand over more spending information
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to the Office for Budget Responsibility to improve its scrutiny of government spending commitments
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Over the months ahead, the Chancellor will look to reduce funding pressures further before the budget
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which is scheduled for the 30th of October. Here at City AM, we'd like to know
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How do you feel about the new government's approach to the country's finances? Let us know in the comments below
