Public spending and sustainable development: a pay-by-result model for the public administration

Purpose – This paper aims to propose a conceptual model to guide public decision makers in orienting public expenditure towards sustainable development, aligning public targets with the sustainable development goals (SDGs) established by the United Nations. It addresses the need for decision-support tools that connect fiscal choices to measurable sustainability outcomes. Design/methodology/approach – This study develops a conceptual decision-support framework grounded in three perspectives: the positioning strategy of public administrations (PAs) with respect to sustainable development indicators; the maximisation of impact in terms of multidimensional well-being; and the efficiency of public resources through public–private partnership (PPP) schemes. The framework links SDG-related performance indicators, public expenditure dynamics and the design logic of Pay-by-Result (PbR) mechanisms. Illustrative policy contexts from two Italian municipalities are used to motivate the framework rather than to provide empirical validation. Findings – The model specifies a structure, key assumptions and an operational workflow that PAs can use to explore SDG prioritisation and spending alignment under alternative parameter choices. It is flexible and can be calibrated across different levels of PA, from central to local and to different sustainability measurement frameworks. Research limitations/implications – The framework points to a clear empirical agenda. Future studies can test alternative benchmarking strategies and criticality thresholds; validate and compare budget-to-SDG mapping protocols across jurisdictions; estimate SDG interaction parameters and expenditure elasticities using suitable panel data and identification strategies; and evaluate PbR-type implementations with robust causal designs, explicitly examining equity and accountability outcomes alongside efficiency. Practical implications – The framework proposed in this study offers PAs a workflow to prioritise SDGs, allocate expenditure consistently with sustainability targets and design PbR contracts that tie payments to measurable outcomes. Social implications – By orienting public spending towards SDG-aligned outcomes, the model supports more accountable and impact-oriented use of public resources, with potential benefits for multidimensional well-being at the community level. Originality/value – The paper contributes to the sustainable finance literature by connecting environmental and social public strategies to public spending trends and PbR-based PPP management within a single conceptual framework.