Government Spending Flashcards

1️⃣ Familiarise yourself with the flashcards:

  • Look through all the flashcards to see what's on both sides.
  • Make sure you understand the information on each card. If something's unclear, click the link to the revision notes at the bottom of the page for more details.

2️⃣ Test yourself:

  • Look at the question or prompt on each card and try to remember the answer before flipping it over.
  • Check the answer and make a note of any cards you find challenging and need to go over more.

3️⃣ Consistently Review and Practice:

  • Use spaced repetition: spend more time on the cards you struggle with and go over them more often.
  • Regularly review all the flashcards to help you better understand and retain the information over time.

Note: We may include questions that have multiple correct answers. It's useful to remember specific examples to understand these concepts better.

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What is government spending?

Money the government uses to provide goods, services, and payments for the public.

Name three main areas of UK government spending.

Health (NHS), education (schools), and defence.

What is current (day-to-day) spending?

Money for running services now. Examples: wages, medicines, and fuel.

What is capital spending?

Money for long-term projects. Examples: building hospitals, schools, roads, and railways.

What are transfer payments?

Money paid to people, not for goods or services. Examples: state pensions and Universal Credit.

What is a public good?

A good you cannot stop people using. One person's use does not reduce another's. Example: street lighting or national defence.

What is a merit good?

A good that helps people and society. It may be used too little if left to the market. Example: education or vaccines.

What is the opportunity cost of government spending?

The next best use of the money that must be given up. Example: more roads instead of more nurses.

Who decides UK government spending plans?

The Chancellor of the Exchequer sets the Budget and departments' plans. Parliament must approve.

What is the difference between central government and local council spending?

Central government funds national services like defence and the NHS. Local councils fund local services like rubbish collection and libraries.

Give two examples of local council services funded by government spending.

Rubbish collection and street lighting.

How can government spending help reduce inequality?

By funding benefits and public services for low-income people. Examples: Universal Credit, social care, and state schools.