In 2020, general government total expenditure in the EU amounted to 53.1 % of gross domestic product (GDP). Due to the COVID-19 pandemic and government measures to mitigate its effects, this ratio increased strongly from the previous year (46.5 %) as a consequence of decreases in GDP, as well as increases in total expenditure (EUR 7118 in 2020 compared with EUR 6 521 billion in 2019; an increase of EUR 598 billion, equal to 9.2 % compared with 2019).
This information comes from recently published data on general government expenditure. The article presents only a handful of findings from the more detailed set of Statistics Explained articles.
Highest proportion of government expenditure goes to social protection and health
Among the main functions of general government expenditure in the EU, ‘social protection’ remained by far the most important in 2020, equivalent to 22.0% of GDP. The next most important areas were ‘health’ (8.0%), ‘general public services’ (6.2%) such as external affairs and public debt transactions, ‘economic affairs’ (6.1%) and ‘education’ (5.0%). The functions ‘public order and safety’ (1.8%), ‘defence’ (1.3%), ‘recreation, culture and religion’ (1.2%), ‘environmental protection’ (0.9%) and ‘housing and community amenities’ (0.6%) had more limited weights.
Strong increases in social protection, economic affairs and health driven by the COVID-19 pandemic
At EU level, general government total expenditure increased for all the major functions, but increases were concentrated in ‘social protection’ (+EUR 238 billion, of which +EUR 118 billion were for ‘unemployment’), ‘economic affairs’ (+EUR 206 billion) and ‘health’ (+EUR 95 billion).
Ratio of social protection expenditure highest in France and Finland, lowest in Ireland
‘Social protection’ represented the most important area of general government expenditure in 2020 in all EU Member States. Government social protection expenditure as percentage of GDP varied across EU Member States from 10.2% in Ireland, 12.0% in Malta and 13.1% in Bulgaria, to over a quarter in France (27.3%), Finland (25.7%) and Italy (25.2%).
Government expenditure on health highest in Czechia and Austria, on education highest in Sweden, on economic affairs highest in Croatia
In 2020, Czechia and Austria (both 9.2%) and France (9.0%) recorded the highest ratios of government expenditure to GDP devoted to health among EU Member States.
The highest ratios of government expenditure to GDP on general public services were observed in Italy (8.7%), Greece and Finland (both 8.4%).
The highest share of government expenditure on economic affairs in 2020 was recorded in Croatia (11.3%), ahead of Malta (10.0%).
For education, the highest shares were registered in Sweden (7.2%).
For more information:
Eurostat set of Statistics Explained articles on government expenditure by function
Eurostat interactive infographic on government expenditure by function
Eurostat database on government finance
Eurostat metadata on general government expenditure by function
While a significant effort was undertaken to harmonise the recording of government measures to mitigate the economic and social impact of the COVID-19 pandemic, a full harmonisation of data for the reference year 2020 was not yet achieved. The likelihood of future revisions is thus higher than usual and data are provisional.
Administrative expenditure data is additionally collected in so-called satellite accounts. In general, the amount of expenditure recorded in satellite accounts is expected to exceed the expenditure recorded under the respective COFOG division. More details on the comparability of COFOG data with satellite accounts data can be found in the COFOG manual. Data on defence expenditure cannot be easily compared with NATO measures of defence expenditure.