1. Priority: Public expenditure should be allocated based on the priorities of the government and the needs of the population. This principle ensures that limited resources are directed towards areas that are most essential and beneficial for society. Priorities can include infrastructure development, education, healthcare, and poverty reduction.
2. Efficiency: Public expenditure should be used efficiently to maximize the desired outcomes. This involves minimizing waste, reducing unnecessary administrative costs, and achieving cost-effectiveness in the delivery of public services. This principle ensures that resources are used optimally and that value for money is achieved in public spending.
3. Equity: Public expenditure should contribute to promoting social equality and reducing disparities. This means that resources should be allocated in a way that benefits all segments of society, especially the vulnerable and marginalized populations. It can involve redistribution of wealth and resources to ensure equal access to public goods and services.
4. Stability: Public expenditure should promote macroeconomic stability and sustainable economic growth. It should be consistent with the overall fiscal policy and economic objectives of the government, such as maintaining a balanced budget, managing public debt, and stabilizing inflation. This principle ensures that public spending does not lead to fiscal imbalances or negatively impact the overall economy.
5. Accountability and Transparency: Public expenditure should be subject to accountability and transparency mechanisms to ensure that it is used in a responsible and accountable manner. This involves strong financial management, proper tracking and monitoring of expenditures, and accountability to citizens. Transparency in public expenditure enhances public trust and confidence in government actions and prevents corruption and misuse of public funds.
Explain five principle of public expenditure
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