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I am talking about UK government budget, should I use the word spending or expenditure? I want to sound casual rather than formal, but still technically correct.

I found this definition but I am not any wiser.

As nouns the difference between spending and expenditure is that spending is an amount that has been, or is planned to be spent while expenditure is (uncountable|countable) act of expending or paying out.

http://wikidiff.com/expenditure/spending

Specifically, I want to describe a budget as having spending x, receipts y and deficit z. Should I rather say expenditure x?

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The government budget is a plan on how money is to be spent and the target maximums allowed to be spent on relevant expenses taking into account forecasted income from taxes etc.

When talking about the budget in this sense, the definition provided in your question answers your question. The government budget is the planned government spending.

When talking about what has been spent against the budget, you are talking about government expenditure(s).

When you look at the UK Government expenditures for 2016 against the income, the income was £217bn and the expenditure was £270bn leaving a budget deficit of £53bn.

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