Public Expenditure

• Public expenditure can be broken down into three categories : Capital expenditure, current expenditure and transfer payments
• Capital expenditure are investments which are a one off payments e.g the Hs2 railway project, new schools, new hospitals
• Current expenditure is spending on goods and services that occur regularly e.g paying teachers salaries or buying text books
• Transfer payments are payments made by the government for which no goods/services are exchanged (it is a one-sided payment and nothing is given in return) E.g. Unemployment benefits, disability payments, subsidies to producers & consumers etc