The FINANCIAL -- Among the main functions of general government expenditure in the European Union (EU), ‘social protection’ was by far the largest in 2016, equivalent to 19.1% of GDP.
The next most important areas were ‘health’ (7.1%), ‘general public services’ such as external affairs and public debt transactions (6.0%), ‘education’ (4.7%) and ‘economic affairs’ (4.0%). ‘Public order and safety’ (1.7%), ‘defence’ (1.3%), ‘recreation, culture and religion’ (1.0%), ‘environmental protection’ (0.7%) and ‘housing and community amenities’ (0.6%) had more limited weights. However, these EU-level data mask significant differences between the Member States in the share of GDP dedicated to each function of general government expenditure.
Share of general government expenditure related to social protection highest in Finland and lowest in Ireland
Social protection represented the largest area of general government expenditure in 2016 in all EU Member States. The ratio of government social protection expenditure to GDP varied across EU Member States from less than 10% in Ireland (9.9%) to over a quarter in Finland (25.6%). Eight Member States – Finland, France, Denmark, Austria, Italy, Greece, Sweden and Belgium – devoted at least 20% of GDP to social protection, while Ireland, Lithuania, Romania, Latvia, Malta, the Czech Republic and Bulgaria each spent less than 13% of GDP on social protection.
Social protection expenditure can be further broken down into a number of detailed groups. The group ‘old age’, which includes pensions, made up the largest part of social protection expenditure in all Member States. Government expenditure on ‘old age’ as a share of GDP was highest in 2016 in Greece (16.0%), followed by Finland (13.7%), France and Italy (both 13.5%) and Austria (13.0%). In contrast, Ireland (3.5%), Lithuania (5.9 %), Cyprus (6.2%) and the Netherlands (6.7%) recorded the lowest shares. General government expenditure on ‘old age’ accounted for 10.2% of GDP in the EU.
Government expenditure on health and education highest in Denmark
With shares of at least 8% of GDP in 2016, Denmark (8.6%) and France (8.1%) recorded the highest proportions of government expenditures spent on health among Member States. Denmark and Sweden (6.9% of GDP), Belgium (6.4%) and Finland (6.1%) registered the highest shares of government expenditure on education in 2016.
For government expenditure on economic affairs, the highest percentages in 2016 were recorded in Hungary (7.1% of GDP) and Belgium (6.5%).
The highest share of government expenditure on general public services in 2016 was observed in Greece (9.2% of GDP). In 2016, 2% or more of GDP or more was spent on defence in Estonia (2.4%), Greece (2.1%), and the United Kingdom (2.0%). The highest share of government expenditure on public order & safety was observed in Bulgaria (2.4%), on environmental protection in Greece (1.6%) and the Netherlands (1.4%), on housing and community amenities in Bulgaria (1.9%) and on recreation, culture and religion in Hungary (3.3%) and Estonia (2.1%).