Objective

The aim of the analysis is to examine how the reporting of local governments’ social protection expenditure differs in public sector financial accounting and reporting, and to identify the reasons for these differences.
The study will develop proposals for classifying social protection expenditures and improving the chart of accounts methodology so that the state and local governments can obtain comparable data for relevant target groups as well as key services and benefits. It will also develop appropriate indicators for comparing and forecasting the volume of social protection expenditure in the future, which could be used in policymaking.

Background

According to §6 of the Local Government Organisation Act, local authorities are responsible for organizing social assistance and social services as well as elderly care within their municipality or city. An analysis of these expenditures helps plan social protection services and the resources required to provide them.
Analysis of the chart of accounts data has revealed a problem: the level of social protection expenditure per capita and the level of municipal contribution to social protection vary significantly between local governments. The existing methodology for allocating expenditures does not provide sufficient comparable information for forecasting across key target groups, social services, and benefits.
One possible reason for this is the differing practices and methodologies used by local governments in reporting social protection expenditure.
As a result of the analysis, appropriate indicators will be developed for comparing and forecasting the volume of social protection expenditure in the future, and proposals will be made for changes to the chart of accounts methodology.

Project client: Ministry of Social Affairs
Project implementers: LevelLab and Geomedia
Study duration: 10/2021 – 06/2022