Local government finances: investment expenses of local governments raise with 17,5% during an election year

“If we don’t do anything we are bankrupt within three years” a newspaper quoted recently the words of the mayor of Kortrijk. It’s essential that the management of public finances on the municipal level is being viewed with the necessary seriousness. How rational are the decisions on receipts and expenses on this level?



Today we have the data allowing us to check if the electoral cycle in the municipal investments and municipal receipts also maintained recently. The conclusion is that this isn’t an isolated incident, both in the field of investments and taxes: the increases in taxes are being postponed until the elections have passed while infrastructure projects to fresh up the municipality are being executed just before the elections. As this planning has consequences for the timing of public works, it’s conceivable that this will bring an extra cost. Contractors have to do overtime hours in artificial peaks that are being ignored. Per percent that the invoices for these capital expenses are higher, can cost the citizen an unnecessary amount of 32 million euro.