Local government will have a €4.1bn budget shortfall this year, €lbn above the European norm, the national statistics office CBS said on Tuesday.

All forms of government are subject to budget agreements within the EU. For councils, provinces and water authorities, the deficit must be no greater than 0.5% of gross domestic product. This works out at €3.lbn.

Local councils in the Netherlands expect a deficit of €2.4bn, €40m more than the agreed maximum, says the CBS. Water authorities say they will be €538m above their budget and provinces say they will overspend by €1.2bn.

Local government is facing extra costs because central government responsibilities are being handed over to them in order to get the state government deficit down to the regulation 3% of gdp demanded by the EU.