The Malta Independent 29 May 2016, Sunday

Social protection makes up one third of total government expenditure

Thursday, 28 January 2016, 11:19 Last update: about 5 months ago

In 2014, Social protection accounted for 31.8 per cent of total General Government expenditure, followed by expenditure on General public services, Health and Education, the NSO.

Total General Government expenditure for 2014 was €3,495.7 million, an increase of €286.4 million compared with the previous year. There were increases in Social protection (€56.2 million), primarily observed in pensions, children’s allowance and child care expenditure and Health (€52.2 million) mainly on Hospital services. Additionally, Economic affairs went up by €46.0 million as a result of higher expenditure on roads whilst General public services increased by €39.3 million. Education also advanced by €28.8 million mainly in the Pre-primary and Primary education.

Expenditure by function as a percentage of total General Government expenditure was largely in line with earlier years. The highest expenditure in 2014 was on Social protection (31.8 per cent), followed by General public services (16.4 per cent), Health (13.9 per cent), Education (13.5 per cent) and Economic affairs (12.5 per cent). In contrast, expenditure on Housing and community amenities had the lowest contribution to total expenditure, followed by Defence, representing 0.8 per cent and 1.8 per cent respectively.

In total, General Government expenditure went up to 43.1 per cent of GDP in 2014 from 41.9 per cent in 2013.

In 2014, the key components of General Government expenditure were Compensation of employees and Social benefits and social transfers in kind with a total expenditure of €1,053.5 million and €1,004.1 million respectively. As regards Compensation of employees, the largest amounts were recorded in Education (€294.2 million), Health (€268.5 million), General public service (€113.1 million) and Economic affairs (€105.9 million). Other major components of General Government expenditure were Intermediate consumption (€526.8 million), Gross capital formation (€293.6 million) and Property income payable (€232.4 million). These five major components made up 89.0 per cent of total General Government expenditure whereas the remaining expenditure involved Subsidies and Transfers.

When examining General Government expenditure in a more detailed breakdown (by group using the COFOG classification), for 2014, the largest expenditure was on Old age (€648.8 million) which represented 58.4 per cent of total expenditure on Social protection.

This was followed by Hospital services (€325.0 million) making up 66.9 per cent of total expenditure on Health. Moreover, large spending is registered on Public debt transactions (€234.0 million) and Executive and legislative organs, financial, fiscal and external affairs (€233.9 million).

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