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PESA 2002-038. Analysis
of public expenditure by
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INTRODUCTION 8.1 This section presents analyses of public expenditure outturn1 by country and region. For these purposes expenditure is allocated to a specific country or region to reflect the relative benefits incurred by the respective populations. 8.2 It is important to recognise the limitations of this approach. In addition to practical difficulties that limit the extent of disaggregation possible, there are also significant definitional problems associated with allocating expenditure to particular areas on the basis of "who benefits". For example, hospitals and health facilities are not used solely by the residents of the region in which the facility is located and roads serve the needs of more than the geographical area through which they pass. Definitional and border problems become increasingly significant the smaller the geographical unit considered. PUBLIC EXPENDITURE BY COUNTRY 8.3 Public expenditure is planned and controlled on a departmental basis, except where devolved responsibility lies with the Scottish Parliament, the National Assembly for Wales and the Northern Ireland Assembly. This means that in several areas expenditure is planned on a national basis rather than by country. For example, the Department of Social Security is responsible for the operation of the social security benefit system throughout Great Britain. In order to provide more information on the geographic division of expenditure than is available from departmental spending data, an annual exercise is carried out to collect data on expenditure by country, covering outturn years only. In this exercise departments are asked to allocate, where possible, expenditure to England, Scotland, Wales or Northern Ireland. The figures therefore include a wider coverage of expenditure than that for which the Secretaries of State for Scotland, Wales and Northern Ireland are directly responsible. 8.4 As in previous years the analysis focuses on expenditure on services (see Appendix F for a definition). Expenditure on services is divided into identifiable and non-identifiable expenditure. Identifiable expenditure is that which can be recognized as having been incurred on behalf of a particular population. Non-identifiable expenditure is that which is deemed to be incurred on behalf of the United Kingdom as a whole (e.g. defence expenditure and overseas aid). Wherever possible, expenditure that is in theory identifiable has been allocated by some means or other. Where precise accounting information on identifiable expenditure is not available, allocation is based on other available indicators; for example, allocation of administration costs in the same proportions as the corresponding programme expenditure. 8.5 The data presented in this section was collected in the autumn of 2001 and is therefore not entirely consistent with other figures in this publication and individual departmental reports. It does, however, provide an indication of the distribution by country of expenditure on each main function. All data is on a cash basis. THE TABLES 8.6 Table 8.1 shows identifiable expenditure on services by country for a 16 year period from 1985-86 to 2000-01. This represents the full run of years for which data have been collected and published in PESA and its predecessor publications. Past data have been adjusted so as to put the numbers on a consistent basis with the latest data in this publication as regards the coverage of identifiable expenditure and the definition of expenditure on services. However, some of the adjustments made to previous published data are very approximate; this needs to be borne in mind when using the data series to study trends over a long time period, and in particular in looking at year-on-year movements in earlier years. 8.7 Tables 8.2 through to 8.6 give fuller details of identifiable spending by country, broken down by broad function, for each of the five years for which data were collected in the latest exercise. The five years are 1996-97 through to 2000-01. Table 8.7 has a further breakdown of identifiable expenditure for 2000-01 only, showing, for Scotland, Wales and Northern Ireland, the relative contributions of the devolved administrations and of UK departments to spending under each functional head. This table also includes a functional breakdown of non-identifiable expenditure. 8.8 Table 8.8 provides, for 2000-01, a breakdown by programme of non-identifiable expenditure on services that has not been allocated to a specific country. REGIONAL ANALYSIS OF PUBLIC EXPENDITURE 8.9 An
analysis of spending by English region was undertaken during the winter
of 2001. The exercise covers the three years 1998-99, 1999-00 and 2000-01
(last year's exercise focused on two years only). The data presented here
is consistent with that in Tables 8.1 to 8.7, 8.10 The regional analysis exercise further apportions the England totals from the country tables between the composite regions. In accordance with other government publications of regional statistics, expenditure has been apportioned to Government Office Regions. THE TABLES 8.11 Table 8.9 shows identifiable expenditure on services by English region for a 14 year period from 1987-88 to 2000-01. As for the equivalent table for spending by country (Table 8.1), this represents the full run of years for which data have been collected and published in PESA and its predecessor publications. Because of a change in regional boundaries used in these data collection exercises in the mid-1990s, it is not possible to present long run data series at the full disaggregation of the nine Government Office Regions. Instead, a six region breakdown is used, with the current North East and North West regions being combined in a single "North and North West" region, and the current Eastern, London and South East regions being combined into a single "South East and East Anglia" region. 8.12 All past data in this table have been adjusted so as to put the numbers on a consistent basis with the latest data in this publication as regards the coverage of identifiable expenditure and the definition of expenditure on services. As with the equivalent table for spending by country (Table 8.1), some of the adjustments to previous data are very approximate. Indeed, because of the narrower coverage of identifiable expenditure for regional spending analyses up until two years ago, the adjustments that need to be made to past regional spending data are on the whole larger than those that need to be made to past data on identifiable spending by country. The need for caution when using and interpreting the time series is correspondingly greater than for the equivalent series by country. 8.13 Tables 8.10 through to 8.12 present fuller details of identifiable expenditure by region, broken down by function, for the three years for which data were collected in the latest exercise (1998-99, 1999-2000 and 2000-01). 8.14 This follows the practice of last year. The coverage of this year's exercise has been set to ensure all identifiable England expenditure can be allocated to a region. The main benefit of this approach is to allow direct comparisons between expenditure per head in the regions of England and that in the countries of the UK. Exercises in earlier years had shown separately an amount of identifiable expenditure that was unallocated between regions – that is, expenditure identified from the country analysis as being incurred for the benefit of the English population, but not further allocated to a specific region. Table 8.1 Total Managed Expenditure by country, 1985–86 to 2000–01 Table 8.2a Identifiable expenditure by country, 1996–97 Table 8.2b Identifiable expenditure by country, per head, 1996–97 Table 8.3a Identifiable expenditure by country, 1997–98 Table 8.3b Identifiable expenditure by country, per head, 1997–98 Table 8.4a Identifiable expenditure by country, 1998–99 Table 8.4b Identifiable expenditure by country, per head, 1998–99 Table 8.5a Identifiable expenditure by country, 1999–2000 Table 8.5b Identifiable expenditure by country, per head 1999–2000 Table 8.6a Identifiable expenditure by country, 2000–01 Table 8.6b Identifiable expenditure by country, per head, 2000–01 Table 8.8 Non-identifiable expenditure by programme, 2000–01 Table 8.9 Identifiable expenditure by region, 1987–88 to 2000–01 Table 8.10a Identifiable expenditure, by region and function, 1998–99 Table 8.10b Identifiable expenditure per head, by region and function, 1998–99 Table 8.11a Identifiable expenditure by region and function, 1999–2000 Table 8.11b Identifiable expenditure per head, by region and function, 1999–2000 Table 8.12a Identifiable expenditure, by region and function, 2000–01 Table
8.12b Identifiable expenditure per head, by region and function,
2000–01 |
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