Ministers choose most government spending, but some pressures build whoever is in office

Most UK public spending is planned. The Treasury sets departments' budgets in Spending Reviews and the Chancellor can change them in a Budget, so more nurses or a new railway line is a choice ministers make. Other pressures build up year after year. The OBR points to an ageing population and the rising cost of healthcare, which push spending on the NHS up, and to pressure on the UK and other European countries to raise defence spending to its highest level since the end of the Cold War.

The trade cycle pulls public spending up in a slump and down in a boom

When the economy slows, more people lose their jobs and claim benefits, so public spending rises with no new decision; in a boom it falls back. Those benefits are transfers, not G: the government buys nothing with them, and they reach aggregate demand only when claimants spend them, as consumption. G itself moves with the cycle when the government chooses to move it, spending more on goods, services and building projects in a recession, and holding back when demand runs ahead of what the economy can produce.