How to understand public sector spending

This guide explains how government spending is broken down, and the Treasury’s role in controlling spending.

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government



Public sector spending, also referred to as government spending or public expenditure, refers to the money that the government spends. It can be spent on a range of different things – from central and local government, to public sector pensions and welfare.

Government expenditure can be broken down and understood in different ways. This guide outlines the basics behind the breakdown of public spending, and explains some of the terms that you may have heard used to describe different areas of the government’s budget.

Published 29 May 2013