2.1. Government or Public Expenditure

Public expenditure refers to expenses incurred by public authorities – central government, state government and local authorities – for their own maintenance and also for the satisfaction of collective needs of the citizens and/or for promoting their economic and social welfare. For e.g. expenditure incurred by public authorities in running the government in the form of expenditure on administration and maintenance of law and order, as also on education, health, transportation, defence, social security etc.

Government expenditure can be classified under the following heads:

2.1.1. Capital and Revenue Expenditure 2.1.2. Development and Non-Development Expenditure 2.1.3. Direct Expenditure and Transfer Expenditure 2.1.4. Productive and Unproductive Expenditure