The Dutch government spent 150 billion euro in 2007. This is 6.3 percent more than in 2006, and the same increase as in the previous year. The gross domestic product rose by an average 5.1 percent a year in the last two years. Central government revenues were over 3 billion euro higher than expenditure in 2007.
Government spending and revenues
More money for municipal authorities
Just as in previous years, general administration was the largest item of government spending in 2007 (37.7 billion euro). General administration includes spending on public administration, the Senate and the House Representatives of the States General, and parliamentary and government advisory boards. Spending on general administration was 2.4 billion euro higher in 2007 than in 2006. Transfers to municipalities for the implementation of the new Social Support Act accounted for 1.4 billion euro of this.
Government spending by policy area
Hefty rise in spending on childcare
Spending on social provisions rose by most in 2007: 2.8 billion euro. Higher spending on childcare accounted for 1.1 billion euro of this, although two-fifths of this is financed by revenues from compulsory employer contributions for childcare. The government deposited 0.6 billion euro extra in the state old-age pension fund so that the premiums for state old-age pension could remain unchanged. More money was also spent on health care allowances (0.3 billion euro), and on children’s allowance and benefits for young people with a disability (0.2 billion each). As the number of income support benefits dropped in 2007, spending on these benefits fell by 0.3 billion euro.
Increase in government spending by policy area
More money for economic affairs
Spending on economic affairs was 1.3 billion euro higher in 2007 than in 2006.
An extra amount of 0.9 billion euro was earmarked to reduce traffic jams, for infrastructure maintenance and the development of the OV-chipkaart, a smart card for public transport. Compensation payments under the export credit insurance scheme cost the government 0.7 billion euro more net, while it paid 0.3 billion euro less for the Betuwe and high-speed train links.
Interest costs up for the first time in nine years
Interest costs rose in 2007 for the first time since 1998, by 0.5 billion euro. This was the result of higher interest rates in the last year. Interest costs for total government spending are still only half of what they were ten years ago, however (7 percent in 2007 compared with 15 percent in 1998).