Statistics Explained

Archive:Government expenditure by sub-sector of general government

Data from May 2013. Most recent data: Further Eurostat information, Main tables and Database.

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In the European Union (EU) (EU-27) as well as Iceland, Norway and Switzerland, the compilation of government revenue and expenditure data is well established by reference to the European system of national and regional accounts (ESA95). This article focuses on the relative importance of the sub-sectors of general government, i.e. central government, state government, local government and social security funds, in the total expenditure of general government, using data where transfers to other subsectors of general government are consolidated (please see Data sources and availability). Total expenditure is examined at sub-sector level both as an aggregate as well by category of expenditure in each sub-sector. The development of the weight of the sub-sectors over time is also analysed.

Figure 1: Share of sub-sectors in consolidated general government total expenditure, 2012, cumulative percentage of total
Source: Eurostat (gov_a_main)

Main statistical findings

Table 1: Consolidated total expenditure by sub-sector, EU-27 and EA-17, % of GDP and % of total TE, 2012
Source: Eurostat (gov_a_main)
Figure 2: Consolidated total expenditure by sub-sector, EU-27 and EA-17, % of GDP, 2012
Source: Eurostat (gov_a_main)

In 2012 in the EU-27, total expenditure at general government level was equal to 49.4 % of GDP. Central government accounted for 37.1 % of general government total expenditure (TE) or 18.3 % of GDP. State government accounted for 7.7 % of TE or 3.8 % of GDP, local government for 23.1 % of TE and 11.4 % of GDP, with social security funds making up the remainder – 32.1 % of TE or 15.9 % of GDP.

Share of sub-sectors

Share of sub-sectors in total expenditure varies between countries

Figure 1 shows that the importance of the sub-sectors varies between countries. In the EU-27 as a whole, central government is the largest sub-sector in terms of expenditure, while among euro area countries, social security funds account for the biggest part of general government expenditure (40.3 % of TE).

In five countries, expenditure and revenue for a state or regional level is distinguished – this concerns the three regions in Belgium, the Bundesländer in Germany and Austria, the comunidades autónomas in Spain and the Kantone in Switzerland.

In three countries – Malta, the United Kingdom and Norway – the sub-sector social security funds is not separated from central government data. In Belgium, Germany, Greece, France and Luxembourg the social security funds sub-sector had a share of more than 40 % of total general government expenditure in 2012.

Central government accounts for, by far, the largest part of expenditure in Cyprus and Malta. A high share in total general government expenditure is also observed in the Czech Republic (64 % of TE in 2012), Estonia (68 %), Ireland (75 %), Cyprus (76 %), the United Kingdom (74 %) and Norway (66 %).

A high share of local government expenditure is observed in Denmark (61 % of TE in 2012), Sweden (49 %), Finland (40 %), Norway (34 %), the Netherlands (32 %), and Italy (29 %).

For the countries that do report state government data, the importance of this sub-sector tends to be relatively high. In 2012, the share in total expenditure ranged between 16 % in Austria and 37 % (2011, latest year available) in Switzerland.

Conversely, the smallest shares for central government can also be found among these federally structured countries. Central government accounted for 15 % of general government expenditure in Switzerland, 17 % in Germany and 23 % in Belgium.

Share of sub-sectors by transaction

Social transfers form the largest category of government expenditure

Figure 3: Consolidated total expenditure by sub-sector of general government and by transaction, EU-27 in millions of euro, 2012
Source: Eurostat (gov_a_main)

Figure 3 visualises the importance of social transfers (social benefits and certain social transfers in kind, D.6COPAY) in general government expenditure and the predominant role of social security funds in ensuring this distributive role of government. Indeed, the majority of social security funds expenditure is classified into this transaction, with the only other notable expenditure in this sub-sector being 'intermediate consumption' (P.2) and compensation of employees (D.1PAY) – both of which could be characterised as 'operating costs'. Nevertheless, another large share of social transfers is distributed by central government. It needs to be taken into account that since Malta, the United Kingdom and Norway do not separately show the sub-sector social security funds, social transfers are mainly paid by central government in these countries. In the case of the United Kingdom, this influences the EU aggregate.

The largest share of 'intermediate consumption' and 'compensation of employees' is incurred by central and local government, although these are also two important transactions for state government. A large part of 'compensation of employees', when classified by function (COFOG), is attributed to the divisions 'education' and 'health' – together accounting for just under half of this transaction's expenditure (2011 data). For state government, the division 'education' on its own makes up just over half of the total cost of employees, reflecting the state or regional responsibility for education in all of the concerned countries.

For general government as a whole in the EU-27, capital transfers (D.9PAY) to sectors other than general government increased from 2011 to 2012; remaining well above pre-crisis levels. Central government accounts for 72 % of expenditure in this transaction. For example, capital transfers to financial institutions are recorded in this transaction.

From Figure 3 it can also be seen that transfers within general government mainly come from central government and add a sizable amount to central governments' total expenditure, if measured on a non-consolidated basis.

Evolution of the share of sub-sectors over time

The evolution of social transfers is linked to the crisis

Figure 4: Evolution of general government total expenditure by sub-sector, 1999-2012, % of GDP
Source: Eurostat (gov_a_main)
Figure 5: Evolution of general government total expenditure by sub-sector, 1999-2012, million of euro
Source: Eurostat (gov_a_main)

As a share of GDP, total expenditure in state government and local government decreased from 2011 to 2012, but total expenditure in central governments and the social security sub-sectors increased, leaving EU-27 general government TE at 49.4 % of GDP (2011: 49.1 % of GDP). The shift is strongest in central government (from 17.9 % of GDP in 2011 to 18.3 % in 2012), with an absolute increase of about 106 billion euro or a year-on-year increase of 4.7 % also being noted in that sub-sector. EU-27 state government and local government TE decreased by about 0.1 pp. of GDP from 2011 to 2012, while social security funds' TE increased by about 0.1 pp. of GDP.

The striking increase in social security funds expenditure and the more moderate increase in spending in the other government sub-sectors from 2008 to 2009 were largely due to an absolute increase in social transfers in the context of the crisis – these are known to act as automatic stabilisers in a recession. The only decreases in expenditure in absolute terms are observed for central government from 1999 to 2000, from 2008 to 2009 and from 2010 to 2011; the latter seems at least partly due to measures by central government to cut expenditure.

Data sources and availability

This section gives some background information on the data sources used in the preparation of this publication as well as on the methodological concepts and technical terms and codes used.

Reporting of data to Eurostat

Annual government finance statistics (GFS) data are collected by Eurostat on the basis of the European System of Accounts (ESA95) transmission programme, in table 0200 'Main aggregates of general government', table 0900 'Detailed tax receipts by sector' and table 1100 'General government expenditure by function'. As all GFS data are compiled within the ESA95 framework, they follow all methodological guidelines set out in ESA95 and the common rules adopted for national accounts. The legal requirement for transmission of table 0200 data is at t+3 and at t+9 months after the end of the reference period. In this publication data corresponds to the end-March/ April 2013 transmissions of table 0200.

Definition of general government and its sub-sectors

The data relate to the general government sector of the economy, as defined in ESA95, paragraph 2.68: 'All institutional units which are other non-market producers (institutional units whose sales do not cover more than the 50 % of the production costs, see ESA95 paragraph 3.26) whose output is intended for individual and collective consumption, and mainly financed by compulsory payments made by units belonging to other sectors, and/or all institutional units principally engaged in the redistribution of national income and wealth. General government comprises the sub-sectors central government (S.1311), state government (S.1312 - where applicable), local government (S.1313), and social security funds (S.1314). State government data is reported for BE, DE, ES, AT and CH -please see country codes). Data for social security funds is not reported for MT, UK and NO, for the latter two S.1314 data is included in S.1311.

Definition of general government expenditure

Government expenditure is defined in Commission Regulation 1500/2000 and uses as reference a list of ESA95 categories: Government expenditure comprises the following categories:

  • P.2, 'intermediate consumption': the purchase of goods and services by government;
  • P.5, 'gross capital formation' consisting of:
  • gross fixed capital formation (P.51);
  • changes in inventories (P.52);
  • acquisitions less disposals of valuables (P.53);
where P.51, 'gross fixed capital formation': consists of acquisitions, less disposals, of fixed assets during a given period plus certain additions to the value of non-produced assets realised by the productive activity of producer or institutional units (fixed assets are tangible or intangible assets produced as outputs from processes of production that are themselves used repeatedly, or continuously, in processes of production for more than one year);
  • D.1, 'compensation of employees': the wages of government employees plus non-wage costs such as social contributions;
  • D.29, 'other taxes on production, payable',
  • D.3, 'subsidies, payable',
  • D.4, 'property income, payable', consisting of :
  • 'interest, payable (D.41) and
  • 'other property income, payable (D.42+D.43+D.44+D.45),
where D.41, 'interest': excludes settlements under swaps and forward rate arrangements, as these are treated as financial transactions in the ESA 95;
  • D.5, 'current taxes on income, wealth, etc, payable';
  • D.62, social payments: cover social benefits and pensions paid in cash;
  • D.6311, D.63121, D.63131, 'Social transfers in kind related to expenditure on products supplied to households via market producers';
  • D.7, 'other current transfers, payable';
  • D.8, 'adjustment for the change in net equity of households in pension fund reserves' ;
  • D.9, 'capital transfers payable' ;
  • K.2, 'acquisitions less disposals of non-financial non-produced assets': public investment spending
Non-financial non-produced assets consist of land and other tangible non-produced assets that may be used in the production of goods and services, and intangible non-produced assets.


General government data reported in ESA tables 0200 and 1100 must be consolidated, meaning that specific transactions between institutional units within the general government sector – D.4 (property income), D.7 (other current transfers) and D.9 (capital transfers) – are eliminated. Sub-sector data should be consolidated within each sub-sector but not between sub-sectors. Thus data at sector level should equal the sum of sub-sector data, except for items D.4, D.7, and D.9, which are consolidated. For these latter items and consequently total revenue and total expenditure, the sum of sub-sectors should be equal or exceed the value of the sector. For the purpose of calculating the share of each sub-sector in general government total expenditure in this publication but not for data published on Eurobase, flows in transactions D.4, D.7 and D.9 to other sub-sectors of general government (flows with-in the sector S.13) are not considered in the expenditure of each sub-sector. Thus any expenditure shown in these transactions refer to transfers not within the general government sector of the economy. The advantage of this approach is that total expenditure of general government is equal to total expenditure of the sum of sub-sectors of general government. Any other intra-government flows are not consolidated in accordance with ESA95, but these are negligible amounts. They refer to the transactions D.29PAY, D.5PAY, and D.39REC.

Time of recording

In the ESA95 system, recording is on an accrual basis, that is, when ‘economic value is created, transformed or extinguished, or when claims and obligations arise, are transformed or are cancelled.'

Gross domestic product

Throughout this article nominal GDP, i.e. GDP at current prices, is used.


  • pp: percentage points

More data and information

More data can be found in Eurostat's online database under the theme economy and finance. Users might also like to refer to the integrated GFS data publications, which present GFS data in a user-friendly fashion are published shortly after transmissions of annual and quarterly data. For country-specific notes, including on missing data, please refer to the metadata published on Eurobase. In case of questions the authors can be contacted at The GFS tables are also compiled as an Excel publication by sub-sector of general government, please see Annual GFS tables - Excel publications.


In the European Union (EU-27) as well as Iceland, Norway and Switzerland, the compilation of government revenue and expenditure data is well established by reference to the European System of Accounts (ESA95). This article focuses on the relative importance of the sub-sectors of general government, i.e. central government, state government, local government and social security funds, in total expenditure of general government. Total expenditure is examined at sub-sector level both at aggregate level as well as looking at the predominant nature of transactions in each sub-sector and the development of the weight of the sub-sectors over time.

See also

Further Eurostat information


  • Excel publications
  • Statistics in Focus and other publications

Main tables

Annual government finance statistics (t_gov_a)
Government deficit and debt (t_gov_dd)
Quarterly government finance indicators (t_gov_q)


Annual government finance statistics (gov_a)
Government deficit and debt (gov_dd)
Quarterly government finance statistics (gov_q)

Dedicated section

Methodology / Metadata

Other information

External links