This report, published by the Department for Business Enterprise and Regulatory Reform, reveals that the UK public service industry represents 6.2 per cent of GDP. This is similar to Sweden and Australia. Spending on the US public service industry is broadly similar to the UK, but with a lower share of GDP, at 5.3 per cent.
The share of GDP in the larger continental European countries, for example France and Spain is lower at just under 3%. In France in particular, this is nothing to do with a relatively low share of GDP, but it reflects the nature of public spending, which involves much more of an approach of keeping public sector functions within the public sector.
The report notes that India is buying much less in terms of public services per person, providing huge potential for additional spending and additional PSI as the economy grows. Overall public spending in India is currently around 16 per cent of UK. This will grow rapidly in the coming years, and within ten years it is expected to be nearly twice what it is now. The potential market for public service industry in health services in India is dramatic.
The report is available from BERR.