Eurostat and Member States, with the support of the EPC, have created a taskforce whose objective it is
to provide data for individual government expenditure items (based on the Classification of the Functions
of Government – COFOG) with a sufficient level of detail (COFOG second level) and comparability.
The detailed data requirements were defined by the EPC in May 2006 with a view to facilitating the
monitoring and analysis of the quality of public finances within the context of the Lisbon strategy and the
Integrated Guidelines.
The work developed along several lines: making progress on the methodology, increasing data
availability, analysing possible synergies with other existing international data sets, and sharing best
practices for the collection of COFOG data. The legal basis for the delivery of COFOG is the ESA 95
transmission programme. The transmission of the first level of COFOG (10 functions) is mandatory,
while the transmission of second level COFOG (69 functions) is voluntary.^10
3.1. Availability of COFOG first level data and possible conclusions on the
composition of public spending
The transmission of COFOG first level data is well established in all Member States and timeliness and
coverage of these data have recently improved considerably. This data, which is available on Eurostat's
website, provides basic information, albeit at an aggregated level, for the analysis of the breakdown by
function and the changes in the composition of public expenditure. Eurostat is working in close co-
operation with Member States to overcome remaining quality issues.
Graph 1 is an illustration of the possible use of this data. It shows that three functions accounted for the
largest share of government expenditure (not taking into account expenditure on interest) in the euro-
zone both in 2000 and in 2005 (see Graph 1): social protection (19.4% of GDP in 2005), health (6.4% of
GDP) and education (5.0%).
Figure 2 - Aggregated government expenditure of the euro-zone by function in 2000 and 2005 as % of GPD0510152025GeneralpublicDefence
Public orderand safetyEconomicaffairs
EnvironmentprotectionHousing andcommunityHealth
Recreation,culture andEducationSocial
protectionEconomic functions% of GDP2000
2005Source: EurostatSome significant differences in the composition of expenditures across Member States can be observed:
- As for expenditure on social protection, the Nordic Member States plus France, Germany, Austria
and Greece register figures well above the EU25 average (18.8%), whereas the Baltic countries,
Ireland, Romania, Slovakia, Cyprus, Czech Republic, Spain, United Kingdom, Portugal and Malta
stand significantly below this average.
(^10) Data are due at t+12 months after the end of the reference year.