Municipal accounts, 2014

From 2014, the reimbursement of value added tax (VAT) accumulated in the capital accounts is excluded from the operational accounts and included in the capital accounts. This adjustment has caused a variation in the gross operating revenues, gross and net operating surplus in the operational accounts, and contribution, reimbursement and property sale revenues in the capital accounts.

The municipalities’ net operating surplus is estimated at 1.3 per cent of the gross operating revenues in 2014, compared to 2.8 per cent in 2013. This is a reduction from about NOK 10.3 billion in 2013 to NOK 4.8 billion in 2014. Adjusted for the exemption of VAT acquired in the capital accounts, the net operating surplus is approximated at 2.9 per cent of the gross operational revenues.

The revised figures show that the municipalities’ gross operating surplus was about NOK 1.8 billion in 2014 compared to NOK 7.2 billion in 2013. In 2014, the gross operating surplus was estimated at 0.5 per cent of the gross operating revenues, while in 2013 the result was 1.9 per cent. The reduction corresponds to the exclusion of the aforementioned VAT revenues. Had this not been the case, the gross operational results as a percentage of the gross revenues would have been relatively stable and estimated at 2.1 per cent.

Production of services in the municipalities

Most of the municipalities’ resources are allocated to the production of local public services. About 65 per cent of the total gross expenditure covered the municipalities’ central services. In 2014, the municipalities’ gross operating expenditure for essential services such as kindergartens, primary schools and health care services amounted to a total of NOK 46, NOK 73 and NOK 122 billion respectively. Health and care service expenditures increased by about NOK 8 billion from 2013 to 2014 compared to NOK 5 billion from 2012 to 2013. The net operating expenditure for heath care services amounted to about NOK 100 billion.

Investments in the Norwegian municipalities

In 2014, the municipalities’ revised figures indicated that the long-term debts continued to grow. The gross investment expenditures for 2014 showed that the municipalities’ investments were almost NOK 54 billion; an increase of NOK 6 billion from the previous year. High levels of investments have been allocated to primary schools, health care services and transport affairs. The deficit before loans and allocations amounted to over NOK 20 billion in 2014, compared to NOK 16 billion in 2013.

The municipalities’ investment financed by the use of applied loans corresponded to 94 per cent of the total investments. The long-term debts excluding pension obligations amounted to NOK 360 billion; equivalent to about 94 per cent of the total revenues. The municipalities’ pension obligations have increased by NOK 25 billion from NOK 429 billion in 2013 to NOK 453 billion in 2014.