Chancellor Rishi Sunak will set out the public spending plans for the next three years at the Spending Review on 27 October, which will take place alongside an autumn Budget.

While yesterday saw the government announce changes to National Insurance contributions and a temporary tweak to the state pension triple lock, the chancellor also launched Spending Review 2021 (SR21).

This will conclude late next month.

The three-year review for the government’s spending priorities will set government departments’ resource and capital budgets for 2022-23 to 2024-25 and the devolved administrations’ block grants for the same period.

The government said that when added to what it has already provided to invest in the country’s future – including the “additional funding” for health and social care – it will mean “core departmental spending will grow in real terms at nearly 4% per year on average over this parliament”.

By 2024-25 core departmental spending will be £140bn more per year in cash terms than at the start of the parliament, it said.

The Spending Review will set out how the government plans to Build Back Better, which it indicated will include leading the transition to net zero and seizing Brexit opportunities.

An increase in spending is part of a broader plan to return public finances to a “sustainable footing” over the medium-term, the government said.

It is “determined” to get the country’s fiscal position “back on track,” it added.

Government departments have been asked to identify at least 5% of savings and efficiencies from their day-to-day budgets, which will be “reinvested” into the spending priorities.

In a launch letter for SR21, Sunak said: “Departments will be expected to carefully prioritise their bids, and we will need to make trade-offs to ensure that this increased spending is focused on the delivery of our key commitments.

“Given the continued uncertainty around the path of the virus, we recognise that some additional spending on top of these plans may be required in the immediate term as part of the remaining response to Covid-19. This will be considered in exceptional circumstances only, where reform and efficiencies are not sufficient to fund essential activity.”

The Office for Budget Responsibility will prepare an economic and fiscal forecast which will be presented alongside the autumn Budget and SR21 on 27 October 2021.

In recent years the schedule for the Budget and Spending Review has had to be revised due to a general election and the pandemic.

The financial updates have been out of sync from what was laid out by former chancellor Philip Hammond.

He decided to move the annual Budget from spring to autumn to allow for more time to implement tax changes before the new tax year begins in April.

A delayed Budget was held on 3 March this year.

There had been speculation the Budget would be postponed until next year.