Public goods must be provided by the government due to two key characteristics that distinguish them from private goods: non-rivalrous consumption and non-excludability.

First, public goods are non-rivalrous in nature. Unlike private goods such as clothes or food items, where one person's consumption reduces the availability for others, public goods can be enjoyed by many people simultaneously. For instance, measures to reduce air pollution benefit everyone without reducing the benefit available to others.

Second, public goods are non-excludable. There is no feasible way of excluding anyone from enjoying the benefits of these goods. This creates the problem of free-riders — users who benefit from the good without paying for it. Since consumers will not voluntarily pay for what they can get for free, it becomes difficult or impossible to collect fees for public goods.

As a result, private enterprises will generally not provide these goods because the link between producer and consumer through the payment process is broken. Hence, the government must step in to provide for such goods through public provision, financed through the budget.