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Expenditure need refers to the ability of governments to finance their responsibilities after taking into account factors that affect the volume of services provided and the cost of providing those services.
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The Volume of Public Services. A jurisdiction with many young or elderly people who require expensive health care, or many school-aged children who require education has a high demand or need for public services. Experts often refer to this as a high workload. It is often measured by the socio-demographic and economic characteristics of a jurisdiction’s population.
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The Cost of Providing Services. Some jurisdictions face higher costs of delivering public services because of higher wages, higher property and material costs, the need to serve remote or sparsely populated areas, and, sometimes because they are less efficient or are ineffective in delivering public services.
These factors do not take into account other factors that are within the control of a government, such as societal preferences.
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