WASHINGTON (REUTERS) - US President Barack Obama's fiscal 2016 budget proposes a roughly 7 per cent increase in spending over mandatory levels set in spending caps known as "sequestration," a White House official said on Thursday.

The budget proposes US$530 billion (S$717 billion) in non-defence discretionary spending, which is US$37 billion above the caps, and US$561 billion in defence outlays, which is US$38 billion above the limits, the official said.