Local government, revenue and expenditure by type, 2002

The local government surplus or net lending - a major indicator in assessing the health of local government finances - was approximately NOK 12.4 billion in 2002. But if we exclude earmarked grants connected with hospital-debt, preliminary figures indicate a deficit of approximately NOK 9.2 billion in 2002.

Less revenues and expenditures

The fact that central authorities took over the responsibility for all hospitals reduced both revenues and expenditures in 2002.Preliminary figures indicate that revenues decreased by 6.5 per cent, while total expenditure decreased by 14.8 per cent compared with 2001.The decrease in total local government revenues is mainly caused by lower tax revenues. Tax revenues amounted to NOK 90.8 billion in 2002, a decrease of 15.7 per cent compared with 2001. The reduction is as result of lower tax rate to county municipalities.

The decrease in total local government expenditure is mainly caused by a reduction in wages and salaries. Wages and salaries amounted to NOK 124.8 billion, a decrease of 14.1 per cent. Intermediate consumption showed a decrease of 17 per cent compared with 2001. The reduction in both wages and salaries and intermediate consumption may be explained by the fact that central authorities have taken over the responsibility for all hospitals.