UK Government spending – real and as % of GDP

In 2015/16 the UK government is forecast to spend a total of £753 billion.

real-government-spending

Source: HMT public spending statistics (May 2017)

Also see: HM Treasury PESA (released 21 July annually

Real term trends in public spending

Source: HMT public spending statistics (May 2017)

   UK Pension spending

More details on pension spending.

Government spending as % of GDP

government-spending-percent-gdp-post-war

Years 2018/19/20, forecasts

Forecasts of Government spending from Autumn Statement of Dec. 2014

government-spending-percent-gdp-obr-14

Source: OBR, Dec 2014

This is outdated, but I leave in because it illustrates how chancellor George Osborne hoped strong economic growth would enable government spending to fall to 35% of GDP by 2018/19. However, that will not happen because of lower than expected growth and unexpected government spending.

 

Government borrowing

net-borrowing-totalJ511

Background to government spending

In 2000-01, several years of government spending restraint combined with rising economic growth, saw government spending shrink to under 35% of GDP. Between 2001 and 2007-08, spending rose to over 40% of GDP due to sustained increases in spending on health, education and welfare spending.

  • Between 2008-09 and 2009-10, the UK saw a large drop in real GDP of 6%, but due to automatic stabilisers government spending increased (e.g. higher unemployment benefits). This caused government spending as % of GDP to rise to 47%.
  • Government spending as % of GDP is forecast to fall closer to 40% of GDP by 2016-17 (if growth targets are met)

Historical government spending

Government spending in 1970s and 1980s. This graph shows real spending adjusted for inflation.

government-spending-real-1967-2012

 

UK government spending as % of GDP since 1900
government-spending-percent-gdp-1920-2020

  • Between the late 1940s and 2000, government spending as a % of GDP has stayed around 40%.
  • But, actual real government spending triples from £100bn to £300bn

government spending real termsGovernment spending in real terms

(at 1995 prices means the actual spending is adjusted for inflation since 1995.

This is due to an increase in GDP. A similar tripling of real GDP from £4,000 per capita to over £12,000

real gdp

What does the Government spend its money on?

See posts on:

government-spending-actual-billion

Further reading – What does the government spend its money on

Related issues Government Taxes

net-taxes-ni

Government taxes as % of GDP

taxes-percent-gdp

It is worth noting that net public sector receipts in 2011-12 were 36.9% of GDP – This is higher than total tax revenue of 35%. This is because the government can receive income from the proceeds of privatisation or selling mobile phone licenses.

Public sector debt

net-debt--billion-nominal

Public sector debt – nominal – more at UK National debt

Source of Data on government spending

Related Posts

 

Data Government Spending £ billion at 2010/11 Prices

1967-68238.0
1968-69240.8
1969-70240.8
1970-71249.1
1971-72255.4
1972-73263.9
1973-74291.9
1974-75319.9
1975-76325.0
1976-77326.4
1977-78313.6
1978-79319.8
1979-80326.4
1980-81331.8
1981-82338.1
1982-83348.7
1983-84361.5
1984-85367.8
1985-86363.7
1986-87366.5
1987-88369.1
1988-89360.5
1989-90372.3
1990-91376.1
1991-92394.5
1992-93416.5
1993-94425.7
1994-95438.5
1995-96444.2
1996-97437.2
1997-98437.0
1998-99439.9
1999-00447.9
2000-01443.7
2001-02496.1
2002-03523.5
2003-04553.9
2004-05582.1
2005-06605.2
2006-07619.1
2007-08640.8
2008-09674.2
2009-10707.0
2010-11708.9
2011-12693.6

Government spending as % of GDP

1967-6844.6
1968-6943.4
1969-7042.5
1970-7142.7
1971-7242.6
1972-7341.9
1973-7444.4
1974-7548.6
1975-7649.7
1976-7748.6
1977-7845.6
1978-7945.1
1979-8044.6
1980-8147.0
1981-8247.7
1982-8348.1
1983-8447.8
1984-8547.5
1985-8645.0
1986-8743.6
1987-8841.6
1988-8938.9
1989-9039.2
1990-9139.4
1991-9241.9
1992-9343.7
1993-9443.0
1994-9542.5
1995-9641.8
1996-9739.9
1997-9838.2
1998-9937.2
1999-0036.3
2000-0134.5
2001-0237.7
2002-0338.5
2003-0439.3
2004-0540.5
2005-0641.2
2006-0740.9
2007-0841.0
2008-0944.5
2009-1047.7
2010-1146.8
2011-1245.4
2012-1343.1
2013-1444.4
2014-15e43.3
2015-1642.2
2016-17e40.9
2017-1839.5

 

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