Thinking Aloud: Spending Review 2013 at a glance

Yahoo! UK and Sky News this week launch a new video series that tackles the big issues. Hosted by Joey Jones, 'Thinking Aloud' is to be a weekly show screened every Thursday that will invite two experts to debate the hard-hitting subjects that affect us all. This week Jones and his guests - columnist for The Independent Owen Jones and political blogger Harry Cole (aka Guido Fawkes) -  will chew over the Government's latest Spending Review, due to be announced by Chancellor George Osborne today. Here's a rundown of what the spending review is and why it's worth serious discussion:

So, the Spending Review 2013. What's it all about?

It explains how the Government will spend £740 billion of taxpayers money between April 2015 and April 2016. It  also includes more details on £11bn-worth of cuts to department budgets. Chancellor George Osborne announced the plans today. All areas of departmental current spending will be asked to tighten their belts except the NHS, schools and overseas aid, which are ring-fenced.
Follow our live blog for the speech and reaction.

Sounds important
It is. It sets the tone for the first year of a new Government as a General Election must be called by May 7, 2015. It is also the first Spending Review since October 2010 - and we all know what happened then.

Just go over it one more time...
It was all pretty sobering. It set out plans between 2011 and 2015 for an average 19% cut in departmental budgets, £7bn in additional welfare budget cuts - including changes to incapacity, housing benefit and tax credits - and a 4% cut in police funding. It was also announced the retirement age would rise from 65 to 66 by 2020. Total cuts over the four-year period are set to eventually total £81bn and will lead to 490,000 public sector jobs going.

And is it a case of the same again this time round?
Cuts are still the order of the day - but they aren't quite as deep as the 2010 announcements. Most Whitehall departments are facing fresh cuts of between 6% and 10% . On the plus side, Mr Osborne is expected to give more details of billions of pounds of infrastructure spending designed to bolster the recovery.

What tangible changes will we see?
Addressing the Commons today Mr Osborne announced that public sector pay rises will be limited to an average of up to 1% for 2015/16 and automatic progression pay in the civil service will be ended by 2015/16. He said the Government is working to remove automatic pay rises for time served in schools, NHS, prisons and police, but the Armed Forces are excluded from these reforms. The Office for Budget Responsibility forecasts the total number of people working for the Government will fall by a further 144,000 by 2015/16. A new welfare cap will be set each year at the Budget for four years, applying from April 2015. Housing benefit, tax credits, disability benefits and pensioner benefits will be included in the cap, but the state pension will not. A new Upfront Work Search system will require claimants to provide a CV, register for online job search and start looking for work before getting benefits. But councils will be funded to freeze council tax for the next two years, saving an average £100. There will also be £50 billion of capital investment made available in 2015 for infrastructure including roads, railways, bridges, broadband, science and schools. Mr Osborne promised the largest programme of investment in roads for 50 years and in railways since the Victorian age.

Why does the Government believe it needs to make these cuts?
The public finances are in a parlous state. According to Mr Osborne the UK's public debt interest repayments now total £120m a day, or £43bn a year. He says the spending round 'shows our determination to take the tough decisions needed to deliver our economic plan and to turn Britain around'. The Government insists the cuts will allow it to reduce the public debts and trim debt interest payments.

Are there any alternatives?
Labour thinks so. Shadow Chancellor Ed Balls has indicated a Labour Government would set higher taxes and borrow more to pay for infrastructure investment. He said: "On capital spending, we're saying this year and next year, the Chancellor should be investing to get the economy growing."

Are the cuts fair?
A vexed question. Mr Osborne claimed that Treasury analysis shows the top one-fifth of the population lose most as a result of this spending review. But The Guardian’s Polly Toynbee suggests this is simply not the case. She writes: “Dorset is almost untouched while Liverpool is hardest hit; the comfortable of Witney or Tatton need see nothing distressing. But should David Cameron and Osborne choose to discomfort themselves by venturing somewhere like Stoke, I recommend a couple of days with the social fund team, listening to the calls of the utterly desperate.” The question of who is bearing the most pain is likely to lead the debate once more.