14-001-1992
7
11-24
TB QO
† 652 868 9279
Paper 4 (P. 204.5)
AN
Present Definition of the Public ector for Budgetary Purposes
5.
The present definition of public expenditure employed by Finance Branch in applying budgetary policy is to include all payments made from Government's accounts (except for equity investments from the Capital Investment Fund and debt
repayments), together with payments by the Housing Authority, the Urban and Regional Councils and the Lotteries Fund, i.e. it includes fully the payments of bodies staffed exclusively by civil servants but only the net subventions to aided organisations. The simple definition is both easily understood and is equally easy to apply?
6.
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However, even this simple definition is not without its problems. While the Government can control its own expenditure, its ability to control the spending of the Housing Authority and of the two municipal councils is somewhat tenuous (it can only influence their spending indirectly; by exercising some constraint on their revenues) On the other hand, the Housing Authority, for example, is the principal delivery agent of Government's housing policy. To exclude its spending from the definition of
of public sector expenditure would result in the omission of almost the whole of the expenditure on what is an extremely important programme area
7.
म
of greater concern is the effect on this definition of the potential restructuring of the delivery of services which may reduce
reduce the Government'
Government's direct role in the provision of
services or, on the establishment of trading funds, the Government's ability directly to control the level of spending on particular services.