{"id":13996,"date":"2022-12-08T12:20:12","date_gmt":"2022-12-08T11:20:12","guid":{"rendered":"https:\/\/altax.al\/?p=13996"},"modified":"2022-12-08T13:08:44","modified_gmt":"2022-12-08T12:08:44","slug":"our-experts-propose-that-the-new-draft-law-on-local-finances-should-be-inclusive-and-have-expert-dialogue","status":"publish","type":"post","link":"https:\/\/altax.al\/en\/our-experts-propose-that-the-new-draft-law-on-local-finances-should-be-inclusive-and-have-expert-dialogue\/","title":{"rendered":"Our experts propose that the new draft law on local finances should be inclusive and have expert dialogue"},"content":{"rendered":"

During the monitoring of the public consultation<\/a> process in 5 municipalities of the country, the 2023 local budgets describe local developments and fiscal policy in the same spirit as the 2022 budget, where optimism and the presentation of achievements prevailed, without showing the other side, that of a critical approach, that of weaknesses, performance deficiencies and reflecting the comments of civil society, as well as business & their representatives.<\/p>\n

This is the moment that the Ministry of Finance should target through the change in law no. 68\/2017 “On Local Self-Government Finances”<\/a> to change the replacement of approved annual expenses with actual annual expenses in the formula for calculating the percentage of the value of the stock of ascertained and unpaid liabilities that the local self-government units have towards the parties the third.<\/p>\n

Meanwhile, the other proposal related to an addition to this law, which aims to reduce the amount of arrears that can be created by the local self-government unit, that is, another measure for their prevention and resolution, using the funds inherited from the past is viewed by experts with a reservation, as even currently the repayment of arrears and new obligations are clearly defined in the tasks of the municipalities, but they have not been implemented.<\/p>\n

The reasons are different, but mostly the change of priorities of local budgets as well as the shortcomings related to the analysis of income and expenses, that is, fiscal management is a problem mentioned in the audits carried out by High State Audit (alb. KLSH).<\/p>\n

According to our experts<\/a>, fiscal discipline is affected by large fluctuations in spending according to function.<\/p>\n

Starting from past experiences, as well as based on risk management criteria, some identified and assessed (non-exhaustive) risks in the optimistic forecast and non-realization of income, such as: (a) Lack of indicators updated by institutions for a realistic forecast and data from as many sources as possible, (b) Lack of specific analysis and calculation of costs related to the cleaning fee for a realistic forecast of revenue for collection, (c) Incomplete digitization of the system and risk of effective time management for the calculation related to the fiscal packages, (d) Weak culture of cooperation between the directorates within the Municipalities and those outside it (Central Business Center, State Cadastre Agency, Regional Tax Directorate)<\/em>, (e) Non-full capacity operation of the Fiscal Cadastre for building tax, land, etc. Easily accessible social audit reports prepared by experts are exactly what is needed to address minimizing these risks.<\/p>\n

Although the stock of budget arrears is being cleared, the municipalities are focusing on not creating new debts. However, it has not been possible to completely prevent the creation of new liabilities. Municipalities should create a system reporting approach for monitoring arrears through the Treasury system.<\/p>\n

The experts see the problem not simply<\/a> and only these legal changes, but the need for the inclusion of all civil expertise, as a non-stop healthy opponency to the developments of the local budget, which should also find inclusion in legal acts, as a demand of civil society.<\/p>\n

The complex nature of budget issues for citizens and the lack of a citizen analysis with facts and arguments against the programs of the Municipalities and the Central Government need to be reformatted regarding the orientation of priorities according to citizen demand.<\/p>\n

Although the number of consulted citizens is low enough to be considered as a citizen’s voice, having no other data available for the budget analysis, apart from the online website of the Municipalities (the online data completes most of the information to enable our analysis) it is urgent need for more civic expertise ana analysis beyond the state agencies.<\/p>\n

Public consultation and transparency should receive special attention and care in completing the data.<\/p>\n

Local fiscal policy should now aim to tax more the things that hurt us the most, or the things we love least, such as: pollution and waste in the environment, and subsidize the things we love most, such as: education and research, a local economy more diverse, productivity-oriented and based on technology and intellectual skills.<\/strong><\/p>\n

All this modified approach of governing will in these moments of budget consultations should aim at strengthening accountability. From the current moment of the formulation of the draft budget and the fiscal policy related to it, but also in the implementation of the budget, it is necessary to communicate with the public through reporting standards, with the language of financial facts and compliance in the implementation of the law. For this purpose, an ACTUAL budget dialogue calendar is needed that should accompany the draft budget every year, just like the fiscal package and become a mandatory part to be considered.<\/strong><\/p>\n

CITIZEN budgeting can work quite simply.<\/p>\n

Instead of the City Council deciding how to spend several million Euros from the “budget menu money” that is allocated every year to each of the community members from their own income and those of the state budget for education, training, social support, capital improvements, it is necessary that:<\/p>\n