Public finance comes from two words, public referring to a crowd of people that is characterized by an organized structure of governance- the government- and finance referring to the fiscal resources. Therefore, public finance can be described as the responsible management of public financial resources by the government to ensure equality, proper administration, and delivery of basic services to the public. In my view, public finance should ensure an improved quality of life enjoyed not only by current but also future generations. This is because the revenue acquired by the government if well managed can be used to plan both short term and long-term goals that will facilitate financial security and freedom.
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It is notable that the government has to source for revenue in order to be able to fund its activities and hence run smoothly. In addition, the revenue is meant to aid the government in providing quality services to its citizenry. Some sources of income include collecting taxes, administrative income and income from public assets for instance, parastatals and lastly, an increase in debt. This revenue if managed well will promote equity and an improved wellbeing for the public.
Consequently, the public’s wellbeing is correlated to the standards of certain socio-economic pointers that the government can control through public expenditure policies. These socio-economic pointers include life expectancy rates, child mortality rates, educational attainment rate, growth in per capita revenue and inflation among others. A government’s achievement can be measured by how successful it is at regulating these socio-economic pointers in the right direction. Proper budgeting and spending and the right decision-making are key when it comes to ensuring stability and an improved quality of life to the public.
Conversely, the order of priority enhances competence and liberation for any government. If the management put in place ranks activities that are of lower importance to the public then it will eventually translate to poor quality of life for all. The basic needs are education, medical care, food, shelter and clothing. If the basic needs were properly prioritized, it would then mean better services and an improved quality of life for both current and future generations. For instance, investing in proper medical care will constantly reduce child mortality rates and increase life expectancy rates. In addition, if the government invests in providing affordable education it will ensure that an increased education attainment rate is achieved and that will greatly reduce illiteracy levels, the ripple effect will being that more people will be employed in well paying jobs. This in turn will increase the revenue to the government. Likewise, low taxes will translate to increased disposable income, and the ripple effect will be that the inflation rates will be low. When the inflation rate is low, many people will be able to afford what they want hence, enjoy an improved quality of life.
In conclusion, a well-managed public finance is beneficial to both current and future generations. If the government can plan wisely, the measures it would put in place would ensure security and financial stability for their citizen, which then means that the government will have more disposable income coming from the citizens through taxes and the other sources of income. Generally, the public will enjoy lower child mortality rates and an increased life expectancy rate since medical costs will be subsidized. Lower child mortality rates will mean that the future generation is already well taken care of. Decision-making that lacks political interference ensures that decisions made are based on facts and widely researched information.