Local government deficit totals 1.6 billion euro

02/05/2006 14:00

Local government contributed -1.6 billion euro to the government deficit in 2005. Central government and the social funds booked a surplus of 0.2 billion euro. The deficit (according to EMU criteria) of total Dutch government therefore came to 1.4 billion euro.

Contribution of local government to deficit (EMU criteria)

Deficit increased slightly in 2005

The deficit of local government - according to EMU criteria - has fluctuated in recent years. Following a low point in 2002, -2.3 billion euro, in 2004 the deficit was 1.3 billion euro. In 2005 it increased again, to 1.6 billion euro.
Municipal government accounted for 1.9 billion euro deficit, the water boards for 0.2 billion euro. Provincial government, on the other hand, has been contributing positively for years now. They had a surplus of 0.2 billion in 2005, the same amount as in 2004.

Local government deficit (EMU definition) 

Long-term debts up

Municipalities’ long-term debts rose by more than one billion euro in 2005, short-term debts fell by the same amount. This shift was cause by the low capital market interest rates.
Long-term credit receivable fell further by 1.4 billion euro in 2005, mainly through repayments by housing associations on long-term loans outstanding with municipalities. The revenues from these repayments were used to finance the deficit.

Municipalities: payables and receivables

Florianne Matser and Elena van Kampen