Norwegian municipalities hit hard by cost of Covid-19 in 2020

Norwegian municipalities hit hard by cost of Covid-19 in 2020
Photo by Theo Eilertsen Photography on Unsplash
Various restrictions and closures put in place due to the Covid-19 pandemic cost Norwegian municipalities around 14 billion kroner in 2020, according to a report.

The municipal sector also received around 20 billion kroner in increased subsidies and funding from the Norwegian government last year, news wire NTB reports.

More than two thirds of the funds are provided for increased costs related to the pandemic as well as compensation for reduced income.

“Throughout the coronavirus crisis, the government has been clear that we must stand up for the municipalities by compensating for increased expenses and lost revenue. The report shows that we have done just that,” Minister for Local Government Nikolai Astrup said in a statement.

The estimates in the report are based on a survey by KS, the Municipal Sector Organisation, on the expenditure of a selection of municipalities and all counties. In total, the pandemic has cost municipalities 10 billion kroner and county municipalities 4 billion kroner.

READ ALSO: Why Norway’s earnings dropped in 2020 despite steady taxes from individuals

The health and care sector is, unsurprisingly, responsible for around half of the estimated additional expenditure. Increased expenses for salaries, testing, infection tracking, infection control equipment and costs related to isolation and quarantine are the largest contributors to the bill.

“The municipalities have been on the front lines during the pandemic, and many have done a formidable job with testing and infection tracing at the same time as they have provided services to their inhabitants. It has been a demanding year, and I am impressed for all the work they have done,” Astrup said.

In addition to the increased costs of the pandemic, municipalities also lost money as a result of schools and kindergartens in Norway closing last year, as well as a loss of income through sports and culture.

At county level the financial consequences of the pandemic are mainly related to reduced ticket revenues gained from public transport.  

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