Why Should Expenditure Equal Income in Computable General Equilibrium (CGE) models? I'm reading up on CGE models and one clearing condition that must be met is that Expenditure must equal income.
This seems odd to me because I thought households allocate income to savings and expenditure.
It is because saving is investment expenditure, they must be  equivalent in standard macro models. To explain this forget about CGE models for a second, they are set up in this way because all macroeconomics is set up in this way.
In macroeconomics by definition income = expenditure. This is definitional. For closed economy by definition income (Y):
$$Y \equiv C+ I + G \tag{1}$$
where $C$ is expenditure on consumption (which is what you likely confused with expenditure in general), $I$ is expenditure on investment (public plus private saving), and $G$ is government expenditure (see more details in Blanchard et al Macroeconomics a European Perspective).
Now $I$ will by definition be equal to public and private saving since private saving $S_p$ is by definition income not consumed after taxes: $S_{p} = Y-T-C$. Public saving $S_G$ is by definition any difference between taxes and government spending $S_G = T-G$. Together then all saving must be:
$$S= S_p+S_G = Y-T-C+T-G=Y-C-G$$
Now this must be equal to investment since just by rearranging equation 1 we find that investment is:
$$Y-C-G =I \implies S=I$$
Hence the reason why the CGE imposes restriction that income is equal to expenditure is not that there should be no saving (although there might be simplified models where saving will be 'turned off' to make it easier for students). It is because expenditure and income are macroeconomically equivalent even in presence of saving (which is just investment spending).