In the ESA 2010 sector classification, local government denotes the part of general government responsible for public affairs within a defined locality. It comprises municipalities and other public units whose powers do not extend beyond that area. Local units assigned to social security funds are not counted in the sector. Local government is recorded separately from central government and from state or regional government.
Source: European Central Bank (ECB) (source). This glossary entry is an independently worded adaptation of the cited information.