Public Finance

Running Head: SPENDING REVIEW Introduction The term spending refers to the expenditures that are made by any government. Here in this paper, we will be particularly focusing on the government spending or expenditures made by the government of Britain. Government spending or government expenditure takes into account all the investments and consumptions but does not includes transfer payments that are made by the state of the country. Government final consumption expenditure refers to the acquisitions of services of goods that are made by the government for utilizing them currently in order to satisfy the collective or individual needs of the community members while the term government investment or formation of gross fixed capital is classified as acquisitions of services and goods made by the government that are planned to benefit in the future such as the investment in the infrastructure or spending research. Transfer payments are those transactions in which the government expenditure which does not acquires the services and goods and only represents the transfer of the money such as the payment of social security. The two types of government spending that are gross capital formation and final consumption expenditure

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