The metal expansion tank is supposed to vent excess pressure &/or coolant out of the small open-ended hose when the system is hot, similar to the tank on a Fiat X1/9. When the system gets hot & the coolant/water mix expands, the tank's radiator-style cap dumps out the excess pressure via the small hose that points towards the ground. Technically, it is not a coolant overflow/
recovery reservoir like the standard 850 plastic tank. It's more like the set-up on a Fiat 600 radiator, which has just a small dump hose connected to the radiator cap neck/fitting on top of the radiator, with the hose running down the side of the radiator & dumping excess coolant onto the ground.
If your 1300 cooling system is topped-off full, then you run the car up to temp & the system vents a bit, that would be normal (should not be a huge amount of coolant lost, though). Let the car cool down (say, overnight), then
without refilling the system, run the car back up to normal temp & see if the system stays even (doesn't vent coolant out). If it stays even, you're fine. If it doesn't stay even (continues dumping lots of coolant), there may either be air trapped in the system, or you may have a leak somewhere letting air in & causing the coolant to boil (system is not holding normal pressure). On 850's, 99% of the time it's a faulty cap or corrosion/damage around the opening for the cap (your cap looks new, but I just wanted to let you know this).
You might also want to check your pipes for any pinhole leaks. Easy way is to run the car up to temp, then keep the car idling & put the front of the car up on ramps, crawl/slide under & inspect pipes. This way your system will be under pressure & any leak(s) may be easier to see/hear.
There is a bleed fitting on the upper portion of the front radiator, and I have been told there is another on the heater core which I have not yet found.
Bottom left corner of this photo: