Government Proposes NOK 6.4 Billion Increase in Local Government Sector's Free Revenues

Strategic Insights -

The Norwegian government has proposed a significant increase in the local government sector's free revenues for 2024, amounting to approximately NOK 6.4 billion. This growth is expected to be distributed among municipalities and county municipalities, with NOK 5.1 billion allocated to municipalities and NOK 1.3 billion to county municipalities. The proposed increase is higher than initially announced in the municipal proposition, reflecting the government's promise to address growing pension costs.

Key Takeaways:

  • The government proposes an increase of NOK 6.4 billion in the local government sector's free revenues for 2024, with NOK 5.1 billion allocated to municipalities and NOK 1.3 billion to county municipalities.
  • The growth is higher than initially announced in the municipal proposition, reflecting the government's promise to address growing pension costs.
  • Minister of Local Government and Rural Affairs Sigbjørn Gjelsvik emphasized that the growth will ensure the sector can cover costs related to demographics and pensions, as well as provide room for development.
  • The distribution of free revenues varies among municipalities due to changes in population, discretionary policy allowances, and regional policy allowances.

Statistics:

  • NOK 6.4 billion increase in the local government sector's free revenues for 2024.
  • NOK 5.1 billion allocated to municipalities.
  • NOK 1.3 billion allocated to county municipalities.
  • 4.1 billion crowns adjustment related to income and wealth tax estimate.
  • Significant variation in growth between municipalities and county municipalities, mainly due to changes in population and discretionary policy allowances.

Sources:

  • [1] Al Bawaba (Albawaba.com) "Government Proposes NOK 6.4 Billion Increase in Local Government Sector's Free Revenues".
  • ∅ (2022).