The following table shows examples of the government’s capital and current income and expenditure.
INCOME Current
• Taxation • Dividends
Capital
• EU funds • Privatisation
Current
• Paying nurses’ wages
• Child Benefit Government income and expenditure A
Go to page 217 of your Activities and Accounts Book to identify the government’s current and capital income and expenditure.
THE NATIONAL BUDGET
In the same way that individuals and households prepare budgets to plan their income and expenditure, the government prepares a national budget to plan its income and expenditure for the next year.
Each government minister requests a sum of money to run their department for the year. This request is made to the Minister for Finance.
The Minister of Finance has to calculate how much revenue the government expects to receive from taxes and other sources. The Minister for Finance will then make the decision about how much money to allocate to each department. The sum allocated may not be as much as the department minister wanted.
When the Minister for Finance has decided how to allocate finance for the coming year, a national budget is drafted.
i A
The national budget is a document showing the government’s planned income and expenditure for the next year.
Please, Minister for Finance!
Each group in the class should represent a government department. They will then put forward their arguments to the Minister for Finance (the teacher) to explain why they should get the most funding in the national budget.
Go to page 218 of your Activities and Accounts Book to record your group’s arguments. EXPENDITURE Capital
