This report reviews the level, composition and outcomes of government spending and distills some of the lessons that emerge from efforts by the Southeast Europe (SEE) countries in reforming expenditure policies. The report identifies key remaining challenges and proposes a broad menu of options in further reforms of sectors that account for the largest shares of public spending across the countries, and where reforms are likely to have significant budgetary implications. This has motivated the choice of sectors discussed in the report: social protection (including pensions), health, education, public administration, and infrastructure.