The government today opened up its accounting books for the first time as it published the entire contents of the Treasury spending database.

The vast database contains a total of 24m individual entries documenting where public money comes from, what it is spent on and whose pocket it ends up in.

Publication of the complex 120GB Combined Online Information System (Coins) promises a unique insight into the everyday running of government, and has been widely welcomed by campaigners for open democracy.

But it is proving controversial in Whitehall. Some ministers have expressed unease about the transparency it will bring, exposing every spending decision they make.

However, Danny Alexander, the chief secretary to the Treasury, hailed the release of the data.

The Liberal Democrat minister said: "For too long, the previous government acted as if the public had no right to know where their hard-earned taxes were spent.

"Today we have lifted that veil of secrecy by releasing detailed spending figures dating back to 2008.

"This data is complex, but this is a major step forward and shows we are delivering on our promise to make this government more open and transparent while ensuring we deliver value for money for the taxpayer.

"I hope people will take the opportunity to scrutinise carefully how their money is being spent – as I am doing every day in preparation for the spending review."

He said the government would not stop there, adding: "We plan to release more data in the coming months that will be easier for the general public to understand."

The data is being released in a raw format. Members of the public will find it difficult to understand the database without sophisticated analytical tools and expertise, and developers all over the country – including at the Guardian – are working out how to break the data down.

In opposition, the Tories had suggested such a data release could stimulate an industry to analyse and create online services from it, worth up to £6bn a year.

Tom Steinberg, the founder of MySociety, a non-profit organisation that runs several democracy websites in the UK, was this week appointed to a new government committee, chaired by the cabinet minister Francis Maude, looking at how to open up government data further.

Steinberg said yesterday: "Tomorrow's publication is definitely very important as a sign to the rest of government that it is no longer out of bounds from the public any more."

He added that there had been some resistance to the idea from public bodies. "What we're doing is about institutionalising a government that is uniquely more open about publishing data and answering questions," he said.

"We have a couple of hundred years of a culture of not being open to get over. It's not surprising that the big public organisations should prefer to continue a tradition of privacy and secrecy.

"The public should be able to get information out of government, and very soon after it is created, with minimal hassle, without being asked why they want it and what it's for. This is a means to an end of a better government and a more engaged public."

The issue was debated at yesterday's cabinet meeting. A Downing Street spokesman said there had been a "discussion on the government's transparency agenda".

He added: "The prime minister emphasised the importance of transparency across all departments and made the point that while it may not always be comfortable, it was a necessary and important part of making government more accountable.

"The chief secretary to the Treasury gave an update on the Treasury's plans to publish the Coins database and set out more detail on public spending."

There are some concerns that the commercial application of public data – particularly if, in future, it relates to individuals – has the potential to invade people's privacy.

Jim Knight, the former Labour minister responsible for data in government, welcomed the publication, calling it "a rebranding of the open government programme we were working on".

He said: "These days, people can mesh government data with commercially available data. That can give you data right down to the level of a few houses.

"It won't be hard to get down virtually to the individual. Some would argue that gets pretty scary."

The Conservative technology manifesto said: "Our plans to open up government data and spending information will not only help us to cut wasteful spending, but according to new research ... it will also create an estimated £6bn in additional value for the UK."