# Councils post €3.2bn surplus, but many expect deficits ahead

> Municipalities budgeted for a €724m shortfall for 2025 but ended the year €3.2bn in the black, the interior minister told the Tweede Kamer. Part of the surplus is one-off, though, and many councils expect deficits ahead.

Politics · published 2026-10-27 11:05 · https://nlnow.nl/a/dutch-municipalities-end-2025-with-3-2bn-surplus-not-a-deficit/

Municipalities together ended 2025 with a positive operating result of €3.2bn, against a budgeted deficit of €724m. The result was positive for 85% of municipalities, according to the annual overview of local and provincial finances that Interior Minister Heerma sent to the Tweede Kamer.

Municipal debt stayed at 41% of revenue. Solvency, the share of assets not burdened by debt, rose slightly to 40%. Municipalities have posted positive results in their annual accounts since 2020, while their budgets projected deficits. The overview says this is partly down to the gap between the ambitions municipalities budget for and what they achieve in the year. Their tasks have grown strongly, it says, and their capacity to carry them out has not kept pace.

Part of the 2025 surplus is one-off. In September 2025 municipalities were granted €728m to compensate for youth care shortfalls in 2023 and 2024,, with no costs set against it that year.

Provinces achieved a combined result of €561m. Two of the twelve provinces had a deficit. Provincial solvency is high at 68% and their debt ratio is negative: they have lent out and hold more in liquid assets than they have borrowed.

Many municipalities are budgeting for deficits in their multi-year forecasts, partly because of a lower general grant (algemene uitkering) from 2028 and the end of extra youth care funding. The municipalities' association VNG has raised concerns about the balance between ambitions, tasks, resources and capacity, including in talks with central government.

The Van Ark II commission will advise in January 2027 on carrying out the youth care reform agenda (Hervormingsagenda Jeugd). Decisions will follow in the spring 2027 budget round. The cabinet's letter to parliament, Werken aan Balans, announces a new tool, the balansscan, and a mapping of policy freedom per task area. Next year's overview will include this information.

## Background

- **Tweede Kamer**: The House of Representatives, the lower and more powerful house of the Dutch parliament. Its 150 members are elected directly; it can amend bills and holds the cabinet to account.
- **VNG (Vereniging van Nederlandse Gemeenten)**: The Association of Dutch Municipalities is the organisation that represents the Netherlands' municipalities (gemeenten) as a whole. Its members are the municipalities, and it advises and supports them on policy, legal and administrative matters. It also negotiates with the national government and parliament on behalf of municipalities, for example on their funding, such as the general grant (algemene uitkering) from the central government.

From NLnow, news from the Netherlands in English. How stories are made: https://nlnow.nl/about/