Figure 2 - Composition of General Government Total Expenditure
( functional classification)01020304050601999 2000 2001 2002 2003 2004 2005 2006
General public services Defence
Public order and safety Economic affairs
Environment protection Housing and community amenities
Health Recreation, culture and religion
Education Social protection% of GDPThe share of expenditure on Economic Affairs to GDP fell to 6.4 per cent in 2000 from 7.6 per cent
recorded a year earlier, then stood at around 7 per cent in the following two years before rising to 10.1
per cent in 2003. Thereafter, the ratio of expenditure on Economic Affairs followed a declining trend
reaching 5.7 per cent in 2006, mainly reflecting lower levels of subsidies.
The increased importance of a sustainable natural environment in Government’s policy strategy is
reflected in the ratio of expenditure directed towards Environment Protection. The ratio of expenditure
on Environment Protection did not exceed 1 per cent of GDP in the 1999-2004 period, but followed an
upward trend thereafter, reaching 1.7 per cent of GDP in 2006 mainly reflecting expenditure earmarked
for the development of infrastructure for waste management activities.
The ratio of expenditure on Health to GDP followed an upward trend, rising from 4.6 per cent in 1999 to
6.5 per cent in 2005, thereafter declining marginally to 6.4 per cent in 2006, largely reflecting
Government’s investment in the new hospital over the period under review.
Over recent years Government has directed resources towards investment in human capital through
education and training for the labour force to be better equipped to face the challenges presented by an
ever dynamic and competitive environment. Expenditure on Education as a proportion of GDP rose from
5.2 per cent in 2000 to 6.1 per cent in 2003. The ratio of expenditure on education followed a declining
trend thereafter and stood at 5.6 per cent in 2006, reflecting relatively high capital outlays recorded in
2003.
Expenditure on Social Protection comprises the largest component of total expenditure, mainly reflecting
outlays on pensions. On average, the ratio of social protection expenditure hovered around 13.4 per cent
between 1999 and 2002. However, Social Protection expenditure as a share of GDP followed an upward
trend thereafter, rising from 13.6 per cent in 2003 to 14.1 per cent in 2006.