Government expenditure on social protection accounted for almost one fifth of GDP

Government expenditure on social protection accounted for almost one fifth of GDP

Government expenditure on social protection accounted for almost one fifth of GDP

The FINANCIAL -- Among the main functions of general government expenditure in the European Union (EU), ‘social protection’ was by far the most important in 2015, equivalent to 19.2% of GDP.

The next most important areas were ‘health’ (7.2%), ‘general public services’ such as external affairs and public debt transactions (6.2%), ‘education’ (4.9%) and ‘economic affairs’ (4.3%). The functions ‘public order and safety’ (1.8%), ‘defence’ (1.4%), ‘recreation, culture and religion’ (1.0%), ‘environmental protection’ (0.8%) and ‘housing and community amenities’ (0.6%) had more limited weights. These data at EU level mask however significant differences between the Member States in the share of GDP devoted to each function of general government expenditure.

Share of social protection expenditure related to old age highest in Greece and lowest in Ireland

Social protection represented the most important area of general government expenditure in 2015 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 (9.6%) to over a quarter in Finland (25.6%). Eight Member States – Finland,

France, Denmark, Austria, Italy, Sweden, Greece and Belgium - devoted at least 20% of GDP to social protection, while Ireland, the three Baltic Member States, Romania, Cyprus, Malta and the Czech Republic 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 2015 in Greece (15.7%), followed by Italy (13.8%), France (13.6%), Finland (13.4%) and Austria (13.1%). In contrast, Ireland (2.4%), Cyprus and Lithuania (both 5.8%) recorded the lowest shares. General government expenditure on ‘old age’ accounted for 10.3% of GDP in the EU.

Government expenditure on health and education varied significantly across Member States

With shares of at least 8% of GDP in 2015, Denmark (8.6%), France (8.2%), the Netherlands and Austria (both 8.0%) recorded the highest proportions devoted to health among Member States.

The highest shares of government expenditure on general public services in 2015 were observed in Cyprus (10.2% of GDP) and Greece (9.9%).

Denmark (7.0% of GDP), Sweden (6.5%) and Belgium (6.4%) registered the highest shares of government expenditure on education in 2015. For government expenditure on economic affairs, the highest percentages in 2015 were recorded in Greece (8.9% of GDP) and Hungary (8.6%).

In 2015, more than 2% of GDP was devoted to defence in Greece (2.7%) and the United Kingdom (2.1%). The highest share of government expenditure on public order & safety was observed in Bulgaria (2.8%), on environmental protection in Malta (2.0%), on housing & community amenities in Bulgaria (2.1%) and on recreation, culture & religion in Hungary (2.1%) and Estonia (2.0%).