Budget expenditures are funds allocated from the budget. The exceptions are those that are a source of financing budget deficits. Such expenses are the basis of a complex system of relationships that cover not only state authorities, but also members of civil society. The distribution of state budget funds for individual items of expenditure is enshrined in special laws. Budget planning, its discussion, as well as the process of execution and cost control are elements of the overall budget process.
A quantitative assessment of expenditures is made up of indicators such as their growth rate, their total volume, dynamic growth in relation to the gross domestic product, the structure of these expenditures, as well as the amount of government revenue, which, in turn, depends on the level of taxation, non-tax budget revenues, and tax collection and a number of other factors. To study the structure of such expenses, the classification of budget expenditures is used.
Different countries periodically adopt programs to reduce different types of expenses in order to save budget funds and increase the efficiency of their use. But in general, state budget expenditures tend to outstrip the gross domestic product. Factors influencing the dynamics of spending are:
- economic development of the country;
- human development (demographic and social indicators);
- NTP;
- political and institutional and factors;
- external circumstances (various emergencies like wars or natural disasters).
Budget expenditures are classified according to certain criteria.
For participation in social production, government spending is divided into two parts: the first is aimed at developing the level of material production and improving its sectoral structure, the other part is used to maintain and further develop the non-production sphere. The development budget is created to provide government support for investors who invest in the development of highly efficient investment projects, either by directly allocating them allocations on the terms of urgency, payment and repayment, or by providing them with state guarantees.
For public purposes, budget expenditures are divided into the following main spending groups: defense financing; industrial production; Sciences; social and cultural events; formation of reserve funds; the maintenance of law enforcement bodies and state bodies of power and administration; public debt service expenses; foreign economic expenses; other payments and expenses. Additionally allocated are the costs of financing priority national programs.
All of these groups of budget expenditures are divided in turn according to departmental and target characteristics. According to the first classification, in each expenditure group the corresponding ones are allocated: either a ministry, or another state-type institution, or a legal entity that receives budgetary appropriations. This classification feature reflects the most mobile changes in the expenditure structure. On a target basis, expenses are allocated that go to specific costs. The classification of expenditures by purpose creates the prerequisites for the rational use of budget funds, and is the basis for effective control over the expenditure of budget funds.
On a territorial basis, budget expenditures are divided in accordance with the levels of government.