One of the biggest issues facing Labour ministers as they grapple with their new briefs will be getting their spending proposals approved by the Treasury.

Decisions on departmental plans, which establish spending levels to 2009-10 - the likely time of the next general election - will not be taken until next summer. But the 2006 spending review will easily be the toughest since Labour took power in 1997. Hard choices will be needed if spending is not to rise above the 42.4 per cent of gross domestic product that it is already set to reach in 2007-08.