Table 4 - Classification of the expenditures of the General Government by functions (as a percentage of GDP, 2002 )
FUNCTIONAL GROUPS EU-15 De Es Fr Ie It Nl Se Uk01.General public services 6,8 6,3 5,3 7,2 3,5 9,3 8,2 8,9 4,2
02.Defence 1,7 1,2 1,2 2,4 0,7 1,2 1,5 2,1 2,5
03.Public order and safety 1,7 1,7 2,1 1,0 1,5 2,0 1,6 2,1
04.Economic affairs 4,0 4,1 4,5 4,8 5,0 3,8 5,5 4,9 2,4
05.Environmental protection -- 0,6 1,0 1,2 -- 0,9 0,8 0,3 0,6
06.Housing and community amenities 0,8 1,1 1,1 1,0 2,1 0,1 1,6 0,9 0,5
07.Health 6,5 6,4 5,4 8,4 6,4 6,5 4,5 7,1 6,4
08.Recreation,culture and religion 0,9 0,7 1,4 0,8 0,5 0,9 1,1 1,1 0,5
09.Education 5,2 4,2 4,4 6,0 4,3 5,0 5,0 7,5 5,0
10.Social protection 19,0 22,5 13,5 20,6 9,3 18,2 18,0 24,0 15,7
TOTAL EXPENDITURES 47,3 48,7 39,9 53,5 33,3 48,0 47,8 58,2 39,7
Source: EurostatOutput outcomes
The results of R&D+i policy are significant (see Figure 1):
- Domestic R&D spending (public and private) totalled 1.03% of GDP in 2002, breaking the 1%
barrier for the first time. This was a record in R&D spending in Spain in absolute terms and in
relation to the income level, with a 15.5% increase in gross terms and a 7 basis point rise in
relation to GDP; - Companies spent €11 million on technological innovation in 2002, i.e. 1.59% of GDP, a 9%
rise with respect to 2000 and an average annual increase of 4.4% in the 2000-2002 period. The
data also reflect companies’ greater role in R&D+i spending. In 2002, 54.6% of R&D spending
was by business, of which 49.6% was subsidised, compared with 52.4% and 48%, respectively, in
2001; - R&D+i spending under the Programme to Reinforce Human Resources in research and
universities increased by 11.1% in 2003, providing training for 3,165 trainee researchers and 649
postdoctoral interns, among other features; - Substantial progress was also made in human resource indicators. In 2002, around 7.3‰ of the
working population worked in R&D activities (6.9‰ in 2001). The ratio of researchers reached
4.5‰ of the working population in 2002. Moreover, the private sector has become the largest
R&D employer.
5. Findings and conclusions
This analysis is focused only on the spending side, however to improve the quality of public finance it is
necessary to achieve the right public revenues and expenditure balance. In this sense, on the revenue
side, fiscal authorities are working on a reform of direct taxation to be approved next year. This future
reform aims at boosting fiscal efficiency by providing a more neutral tax treatment of investment and
savings decisions and by simplifying tariffs in order to ease the tax pressure on earned income. Another
important objective is to increase fiscal equality.
Summing up, the main conclusions of the Spanish recent experience on “redirecting public spending
towards growth enhancing activities” are:
- This is a very relevant topic for the Spanish authorities, particularly in the context of a new
pattern of growth based on productivity. In this sense, the Spanish budgetary policy gives priority