From the BBC:
US Congress Approves Budget Cuts
President Bush welcomed the passage of the bill
It will mainly affect welfare programmes, including medical cover for the poor and elderly and student loans.
The bill, passed by just two votes in the House of Representatives, was welcomed by George W Bush, who promised more measures to curb federal spending.
The Senate passed the bill in December only after Vice-President Dick Cheney cast a tie-breaking vote.
Democrats described the bill as an assault on college students and the poor.
"The sad truth is all of this is to pay for tax cuts to for the wealthiest people in our country," House minority leader Nancy Pelosi said, referring to $70bn in tax cuts proposed by Republicans.
The cuts - amounting to some $8bn a year - account for about 2% of the budget deficit, which this year is likely to top $400bn.
Overall federal government spending in the US is about $2.6 trillion a year, swelled by huge spending backed by the Republican-controlled Congress in recent years and by earlier multi-trillion-dollar tax cuts.
But most Republicans welcomed the bill, which they argue is a step toward curbing the federal deficit.
"Today we can begin the process of controlling out-of-control government spending," Representative Jeb Hensarling said.
However, correspondents say some members of the party were reluctant to support the cuts, especially in a year of mid-term elections.The bill must now be signed by President Bush. He is due to release his 2007 budget plan, which is expected to call for more cuts, next week.