Municipalities expecting big increase in expenses this year

Dutch municipalities have budgeted over 74.7 billion euros in expenditures for 2024, 9.2 percent more than their 2023 budgets. The increase in budgeted costs is higher than the expected rise in income, up 8.8 percent to around 75 million euros, Statistics Netherlands (CBS) reported based on the 2024 municipal budgets.

According to the statistics office, municipalities budgeted higher costs than last year in almost all policy areas. In six of the ten policy areas, the increase was over 10 percent.

A quarter of the total budgeted costs went to the policy area Other Social Domain, which covers social expenditures like youth care, social work, tackling domestic violence, and asylum shelters. Together, the municipalities budgeted 18.4 billion euros for the Other Social Domain policy area, 11.2 percent more than last year.

In the Governance and Support policy area, budgeted expenses increased by 10 percent, from 11.8 billion euros to 12.9 billion euros. This area covers overhead, civil affairs, the costs of municipal buildings, and interest costs on loans, among other things. The biggest increase here was in overhead costs - the costs associated with the management and support of employees - due to higher wages.

Despite the government abolishing the energy allowance, a major cost item for municipalities last year, the Dutch municipalities budgeted 500 million euros more for income support schemes this year. The budgeted expenses for social assistance, income support, and social participation - the Income Schemes and Participation policy area - increased by 5.8 percent to 12.5 billion euros.

The only policy area where municipalities expect to spend less is Economy. This year, they budgeted 1.58 billion euros for this policy area, compared to 1.64 billion euros last year.