| Definition |
Expenditure incurred by local government on consumption goods and services. This expenditure is recorded as total costs of production, i.e. intermediate consumption (goods and services that local government disposes for its production purpose), compensation of employees (use of own labour force), consumption of fixed capital (use of own production assets), any other taxes on production, net, while deducting receipts from sales. In addition, expenditures on consumption goods and services purchased from market producers and supplied directly to households. Grants paid by local government to private day-care institutions for children are considered social transfers to households since local government finances part of these household services. Local government final consumption expenditure consists of two main parts, i.e. collective (actual) final consumption of central government, and individual consumption expenditure of central government, which is also part of actual final consumption of households. |
