The public sector is not primarily driven by profit, but rather by providing essential services to the public, funded mainly through taxes and government revenue. While individual entities might generate surpluses or "profits," the sector as a whole operates to serve, often running on a deficit that requires public funding rather than generating private-sector-style profit.
Examples include supermarkets, technology firms, and construction companies. Public sector organisations are owned or funded by the government and primarily exist to provide services to the public. Their main goal isn't to make a profit, but to ensure essential services are accessible to everyone.
Governments fund the public sector through taxes collected from individuals and businesses. The goal is not to make a profit but to provide services that benefit society.
The government spends huge amounts of money each year on our behalf. In 2022–23, UK government spending was almost £1,200 billion, or around £17,000 per person. This was equivalent to around 45% of GDP.
Figure 3 displays public sector employment as a percentage of total employment within the LFS framework. In 2020, Nordic countries such as Sweden and Norway ranked first, with values of 37.8% and 32.2%, respectively, while the OECD average reached a share of 20.8% during the same period.
In 2022, the United Kingdom was ranked 16th out of the 38 OECD countries in terms of the tax-to-GDP ratio. 1. In this note, the country with the highest level or share is ranked first and the country with the lowest level or share is ranked 38th. Equal to the OECD average from value-added taxes.
Non-profit: third sector organisations raise funds and generate financial surpluses in order to invest in social, environmental, or cultural objectives. They do not seek to make profits as an end in its own right.
The public sector means the organisations run by government that exist to provide a service for the population and communities. Money to pay for these is raised through a variety of taxes, eg: income tax.
According to government reports, while over 7 crore people file tax returns, only a fraction of them actually pay taxes because many fall below the taxable income threshold or use deductions to reduce liability.
Pie chart of UK government spending, 2023–24. The most significant area of government spending is welfare (£341 billion in financial year 2023–24), with the largest single element of this being for the State Pension, which totals £124 billion.
Public Sector Undertakings (PSU) in India are government-owned entities in which at least 51% of stake is under the ownership of the Government of India or state governments. These types of firms can also be a joint venture of multiple PSUs. These entities perform commercial functions on behalf of the government.
Who Owns All that Debt? On October 21, 2025, the nation's gross debt eclipsed $38 trillion. Of that amount, approximately 80 percent, was debt held by the public — representing cash borrowed from domestic and foreign investors.
There is no independent country that is completely debt-free. Having national debt is considered normal in modern economic systems. The country with the highest national debt is Japan. The United States is not a debt-free country.
Is income tax higher in the UK or Spain, and do UK residents pay taxes in Spain? Income tax rates in Spain range from 19% to 47%, while in the UK, they range from 20% to 45%. Spain offers several tax benefits to foreign residents, potentially reducing the overall tax burden.
Yes, the UK has a hidden "60% tax trap" for people earning between £100,000 and £125,140, where the tax-free personal allowance is gradually removed, creating an effective 60% marginal rate on that income, alongside standard income tax and National Insurance, with ways to avoid it including pension contributions or Gift Aid donations.
India's Ministry of Defence tops the list of the world's largest employers with 2.99 million personnel, followed closely by the US Department of Defense and China's People's Liberation Army.
