Social expenditure to GDP ratio

In 2010, the level of social expenditure according to the European System of Integrated Social Protection Statistics (ESSPROS) as a percentage of gross domestic product (GDP), expressed by the social expenditure to GDP ratio, was 30.4%. The ratio increased sharply from 25.9% in 1980 due to the expansion of social benefits in the early 1990s and from 2000 onwards (2003: 29.4%). The social expenditure to GDP ratio declined in the second half of the 1990s and from 2004. In 2009, social expenditure reached, driven by the crisis, more than a third of GDP (30.8%) for the first time and remained at this high level in 2010. This was due to additional expenditure for unemployment and a decline of GDP.

If wage tax and social contributions, partly due from cash benefits, is deducted from social expenditure, net social expenditure to GDP ratio is -2.9%age points lower (2009: 27.9%). Social benefits paid after consideration of deductions are above all guaranteed remuneration by employers in the event of sickness, bad weather compensation for building workers, pensions and sickness benefit, while benefits for families are granted in full.

Since these are ratios, both consolidation activities or increases relating to individual benefits compared with the change in GDP growth need to be taken into account during the relevant periods.

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Results (overview): social expenditure to GDP ratio

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