Central government spending

Central government expenditure is defined as the central government budget expenditure as reported in the final central government accounts. Data are based on the System of National accounts (SNA), a set of internationally agreed concepts, definitions, classifications and rules for national accounting. Central government spending by function is the breakdown of expenditures on the basis of the activities governments support. The classification system used to provide this breakdown on an internationally comparable basis is known as Classification of Functions of Government (COFOG). COFOG expenditures are divided into in the following ten functions: general public services; defence; public order and safety; economic affairs; environmental protection; housing and community amenities; health; recreation, culture and religion; education; and social protection. Data on central government expenditures by function include transfers between the different levels of government. The general government sector consists of central, state and local governments, and the social security funds controlled by these units. The political authority of central government extends over the entire territory of the country; central government has the authority to impose taxes on all resident and non-resident units engaged in economic activities within the country. The responsibility for the provision of public goods and services and redistribution of income is divided between different levels of government. Data on the distribution of government spending by both level and function can provide an indication of the extent to which key government activities are decentralised to sub-national governments. This indicator of central government spending by function is measured as a percentage of total expenditures.

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Keywords: government expenditure, central government expenditure, government spending