An Analysis of Government Revenue and Expenditure in ... - TARA

139
fence of the State, the collection of taxes and the provision of certain
services to the community, there are certain branches of the
government engaged in trading activities. Examples are the Post
Office, the Post Office Savings Bank, Gaeltacht Services and the
housing activities of local authorities. The object of engaging in
such activities is not usually the making of profits. The housing
activities of local authorities are run at a loss and the object, in the
case of the Post Office, is to just cover expenses. The main interest
in trading bodies from the national income point of view is not in
their gross payments and gross receipts but in the net profit or
loss resulting from their operations and in their expenditure on
capital formation, since as already observed the trading income
of such bodies is a direct contribution to national income and
their gross payments in the form of wages, salaries and expenditure
on goods are not part of final expenditure. In the case of the
Post Office, therefore, the gross trading payments (Post Office
wages, salaries, etc.) are not included in government expenditure,
nor are the gross trading receipts (revenue from sales of stamps,
telephone, etc.) included in government revenue, but the balance of
current receipts over current expenditure, after certain adjustments,
is brought into government revenue as gross trading income.
The method used in obtaining the figures relating to the Post
Office which are included in the national income accounts are described
in Appendix II and the actual items included in the
accounts are also shown. Closely connected with the Post Office is
the Post Office Savings Bank and the treatment of the Savings
Bank is also described in Appendix II.
Only two trading bodies—the Post Office and Post Office Savings
Bank—are included in the central government sector. Although
Gaeltacht Services are engaged in trading no commercial accounts
are available and this branch of the government service has been
treated as a department in which part of the cost of the services
provided is recouped from the public. In nearly all departments
certain costs are recouped from the public as appropriations-in-aid
or as exchequer extra receipts. Such activities are not treated as
trading since the amounts of these receipts represent only a small
fraction of the cost of running the departments. The amount of
such miscellaneous receipts is shown as a separate item in the
government accounts presented here, but it is necessary to deduct
these receipts from government current expenditure and to enter
" net expenditure " in the national income accounts. In the case
of Gaeltacht Services the receipts from the public are considerable
in relation to the amount of expenditure and it would be more
desirable to treat this branch as a full trading body if commercial
accounts were available.
In the local authority sector the housing activities of local
authorities relating to the provision of houses for renting are
treated as a trading activity, in which the rents are deliberately
subsidised, the subsidy being the amount by which the rental income
received from tenants together with other miscellaneous receipts
fall below the current outgoings on the upkeep of houses,,
loan charges and administration costs. The effect of this treatment
is that the expenditure on maintenance and repair and the