Public debt dipped below 50 percent of GDP at end of Q3 2022

© Hollandse Hoogte / Lex van Lieshout
At the end of Q3 2022, government debt as a percentage of gross domestic product (GDP) came out at 49 percent. This is over 3 percentage points lower than at the start of Q1 2022. The first three quarters produced a positive budget balance of 7 billion euros. In 2021, the Dutch government still ran a public deficit of 20 billion euros over the same period of three quarters. Statistics Netherlands (CBS) reports this on the basis of new figures on public finances.

Despite the 7-billion budget surplus over the first three quarters, there was an overall increase in public debt over 2022. Government debt amounted to 451 billion euros as of the end of September 2022; this was 2 billion euros higher than at the beginning of the year. The budget surplus was therefore not used to pay debts, but largely ended up in bank accounts and deposits. The balance in bank accounts and deposits was 5 billion euros higher at the end of Q3 than at the beginning of the year.
The decline in the debt ratio was due to GDP increasing more than debt due to inflation. The debt-to-GDP ratio is almost back to its level just before the coronavirus crisis. At the end of 2019, the gross debt ratio still stood at 48.5 percent of GDP.

Debt-to-GDP ratio
YearQuarterEMU criterion (% of GDP)Debt-to-GDP ratio (% of GDP)
2008Q16043.9
2008Q26043.8
2008Q36044.1
2008Q46054.7
2009Q16057.5
2009Q26056.6
2009Q36057.2
2009Q46056.8
2010Q16057.6
2010Q26059.2
2010Q36059.0
2010Q46059.3
2011Q16059.4
2011Q26060.4
2011Q36061.1
2011Q46061.7
2012Q16062.5
2012Q26063.9
2012Q36064.9
2012Q46066.2
2013Q16066.6
2013Q26068.3
2013Q36067.8
2013Q46067.7
2014Q16067.1
2014Q26068.5
2014Q36068.1
2014Q46067.9
2015Q16068.9
2015Q26066.7
2015Q36065.8
2015Q46064.6
2016Q16064.3
2016Q26063.2
2016Q36061.7
2016Q46061.9
2017Q16059.7
2017Q26059.0
2017Q36057.2
2017Q46057.0
2018Q16055.2
2018Q26054.1
2018Q36053.0
2018Q46052.4
2019Q16050.8
2019Q26050.9
2019Q36049.2
2019Q46048.5
2020Q16049.4
2020Q26055.1
2020Q36055.3
2020Q46054.7
2021*Q16055.2
2021*Q26054.5
2021*Q36052.8
2021*Q46052.4
2022*Q16050.7
2022*Q26050.8
2022*Q36049.0
*Provisional figures

Public revenue up by 11 percent

Public revenue over the first three quarters of 2022 were up by 31 billion euros on the same period in the previous year, representing an increase of 11 percent. Public expenditure rose less steeply, by 4 billion euros or 1 percent. On balance, the government balance improved by 27 billion euros relative to the first three quarters of 2021, when it was marked by a deficit of 20 billion euros. Last year's budget balance stood at 7 billion euros after three quarters.

Government budget balance
YearQuarterBudget balance (bn euros)
2008Q12.596
2008Q2-2.865
2008Q3-2.128
2008Q43.204
2009Q1-3.806
2009Q2-9.552
2009Q3-11.926
2009Q4-7.312
2010Q1-5.854
2010Q2-10.885
2010Q3-13.203
2010Q4-4.188
2011Q1-1.664
2011Q2-11.438
2011Q3-9.442
2011Q4-6.346
2012Q1-0.744
2012Q2-9.604
2012Q3-11.087
2012Q4-4.238
2013Q11.071
2013Q2-7.347
2013Q3-8.667
2013Q4-4.585
2014Q10.55
2014Q2-6.978
2014Q3-6.535
2014Q4-2.173
2015Q11.844
2015Q2-7.046
2015Q3-6.532
2015Q4-1.677
2016Q13.583
2016Q2-2.181
2016Q3-2.615
2016Q42.112
2017Q18.899
2017Q2-1.281
2017Q3-0.785
2017Q43.288
2018Q111.736
2018Q20.092
2018Q30.512
2018Q4-0.712
2019Q113.209
2019Q20.302
2019Q3-1.226
2019Q42.343
2020Q110.181
2020Q2-20.385
2020Q3-9.062
2020Q4-10.322
2021*Q1-2.277
2021*Q2-10.282
2021*Q3-7.681
2021*Q4-2.088
2022*Q17.068
2022*Q23.372
2022*Q3-3.465
*Provisional figures

Revenues from taxes and statutory contributions increased by 22 billion euros, or 9 percent, in the first three quarters compared to the first three quarters of 2021. This increase is in line with GDP growth. Higher profits, higher wages and prices translate directly into higher tax revenues for the state. Other revenues rose by almost 9 billion euros, up 29 percent. This was mainly due to higher natural gas revenues.

Expenditure up slightly despite COVID-19 subsidies ending

Subsidies, falling under public expenditure, decreased by 13 billion euros over the first three quarters of 2022. The sharp decrease was due to the expiry of coronavirus-related government subsidies such as the NOW (Temporary Emergency Bridging Measure for Sustained Employment) and the TVL (Reimbursement Fixed Costs). Other spending increased on balance by over 16 billion euros. Public employees' pay rose by 8 percent, or 4 billion euros. Spending on social benefits, which also includes public healthcare, rose by 5 billion euros. Furthermore, the government allocated an additional 7 billion euros towards various incidental expenses. For example, state-owned EBN had to incur costs for natural gas storage in the Bergermeer and pay corporate tax on natural gas profits. Incidental expenditure further included several government compensation measures. One example is the compensation to savers for past overpayments of tax on savings as a result of a Supreme court ruling (the so-called Box 3 ruling).

Public revenue and expenditure, annualised1)
YearQuarterRevenue (bn euros)Expenditure (bn euros)
2008Q1269.1269.0
2008Q2274.0273.3
2008Q3278.8276.5
2008Q4282.1281.3
2009Q1280.1285.7
2009Q2275.8288.1
2009Q3272.6294.7
2009Q4266.7299.3
2010Q1266.4301.0
2010Q2270.2306.2
2010Q3269.9307.2
2010Q4273.7307.9
2011Q1277.7307.7
2011Q2276.9307.4
2011Q3280.7307.5
2011Q4277.7306.6
2012Q1278.2306.2
2012Q2280.4306.5
2012Q3279.0306.7
2012Q4281.4307.0
2013Q1284.6308.5
2013Q2287.1308.7
2013Q3290.5309.7
2013Q4289.8309.4
2014Q1289.2309.3
2014Q2290.6310.3
2014Q3291.6309.2
2014Q4294.4309.5
2015Q1296.4310.2
2015Q2295.9309.9
2015Q3296.0309.9
2015Q4296.1309.5
2016Q1297.7309.4
2016Q2303.0309.8
2016Q3307.9310.8
2016Q4310.1309.2
2017Q1315.1308.9
2017Q2316.7309.6
2017Q3319.4310.4
2017Q4323.5313.4
2018Q1329.0316.1
2018Q2333.3318.9
2018Q3337.5321.9
2018Q4338.9327.2
2019Q1345.1332.0
2019Q2348.9335.5
2019Q3351.8340.2
2019Q4357.1342.5
2020Q1357.1345.5
2020Q2350.2359.3
2020Q3349.7366.6
2020Q4351.4381.0
2021*Q1350.8392.8
2021*Q2361.2393.2
2021*Q3367.1397.7
2021*Q4376.7399.1
2022*Q1384.2397.2
2022*Q2398.5397.8
2022*Q3407.5402.6
1) Measured as the sum of four quarters

The government balance and the debt-to-GDP ratio are important indicators for the state of public finances in a country. The European convergence criteria allow a maximum deficit of 3 percent of GDP over one calendar year, and a maximum debt level of 60 percent of GDP as at the end of that year. However, the coronavirus pandemic created exceptional circumstances which prompted the European Commission to temporarily suspend its fiscal rules. In its Autumn Memorandum, the Ministry of Finance assumed a government balance for 2022 of -1.0 percent of GDP and a debt level at the end of 2022 of 50.4 percent of GDP.