COELO: Municipal redivision is not saving any money

The Dutch Cabinet is aiming to save a billion euros per year via municipal redivision. However, even in the smallest municipalities redivision will not result in lower expenses, nor in better municipal facilities. Municipal redivision for financial reasons is therefore pointless, according to Maarten Allers and Bieuwe Geertsema of COELO in today's issue of the journal ESB. COELO (the Centre for Research on Local Government Economics) is a research institute linked to the University of Groningen.

COELO compared the expenses per inhabitant in the period 2002-2013 in a number of redivided municipalities with a number that had not been redivided, controlling for population growth, population density and numerous other factors. It turned out that the municipal expenses did not increase any less or more in redivided municipalities than in municipalities that had not been redivided – neither shortly before or during the redivision nor in the long term afterwards.

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Contact: Maarten Allers

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