Fiscal federalism and Fiscal Autonomy: Lessons for the UK from other Industrialised Countries

possible area over which the benefits are distributed. The notion is to combine the most
efficient allocation of public goods whilst avoiding taste differences (Atkinson and Stiglitz,
1980).

Table 2: Sub-Central Government Expenditure as a Percentage of General
Government Expenditure

Total Expenditure						Expenditure on Goods and Services
Federal Countries	1985	1990	1995	latest	%∆		1985	1990	1995	latest	%∆
Australia	46	50	48	50	9	Australia	"^65^	~64~	~64~	~66~	1
Canada	58	57	58	60	3	Canada	77τ	~79~	^^8Γ	~82~	7
Germany²	40	40	38	35	-13	Germany	^3Γ	^^53^		~47~	-10
Switzerland³	51	51	49	49	-4	Switzerland	IF	~58~	^60^	^^63^	77
USA	38	41	45	48	26	Usa	^^67~	^^64^	~63^	~бГ	-9
Spain	28	33	30	36	29	Spain	^35^	~6Γ	~69~	~70~	26
Unitary Countries	1985	1990	1995	latest	%∆		1985	1990	1995	latest	%∆
Denmark	54	54	54	56	4	Denmark	68	69	~69^	~W	2
France	17	18	19	18	6	France	^26^	^^29"	^3T^	IT	28
Italy	■ ■	■ ■	23	25	9	Italy	■ ■	■ ■	~54^	зг	-6
Netherlands	32	28	28	26	-19	Netherlands	^τ5T	^48^-	^^50^		4
Norway	36	36	37	38	6	Norway	~64~	~63~	~бГ	^-6τ	3
Sweden	38	39	33	37	-3	Sweden	~76~	~76~	~70~	7тГ	-6
UK	29	29	26	25	-14	Uk	~41^	~42^	~40~	^39^	-6

Source: IMF Government Financial Statistics, various issues

Notes:

1 The figures for Switzerland relate to 1984 and 1991 rather than 1985 and 1990. The
latest figure for each country the year is the same as that given in Table 1, except in the
cases of Germany and Italy =1998, and Switzerland = 1999.

2 Expenditure on goods and services only excludes interest payments on debt, subsidies
and transfers out of the government sector and capital expenditure, all of which are
predominantly the responsibility of central government.

3 The %∆ column gives the percentage change in expenditure between 1985 and the latest
date for which information is available.

⁶ This explains why the increase shown in Table 2 is not large.

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