The Causes of Rising Public Expenditure in Libya and Measures for Its Rationalization

Abstract

The research paper addresses the critical issue of rising public expenditure in Libya and its challenges amidst current political and economic conditions. It highlights the concept, objectives, and classifications of public expenditure, while providing an analytical study of the reasons behind its growth internationally and locally, distinguishing between apparent and real causes. The study focuses deeply on the Libyan context, attributing the inflation in expenditures to structural factors, such as political division, an inflated administrative apparatus, the depreciation of the dinar, and an over-reliance on consumption and security spending at the expense of development, compounded by weak financial oversight systems. In the second section, the study establishes the concept of public expenditure rationalization, emphasizing that it is not merely about reduction, but rather a strategic redirection of resources toward vital priorities such as education, healthcare, and infrastructure, in accordance with the principles of efficiency and transparency. The study concludes by emphasizing the necessity of adopting comprehensive financial reforms, including restructuring public employment, enhancing the effectiveness of financial oversight, and activating legislation to control spending, thereby ensuring financial sustainability, good governance of public funds, and driving the Libyan economy toward recovery.