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Decentralization of public finance in Poland was an important element of changes in the political system of the country. As a result, some tasks of the state were transferred to the local government level. The Public Finance Act of 2009 introduced new public management methods, such as the performance-based budget and the long-term financial forecast, to the local government finance management. The purpose of this paper was to analyse the budget expenses on cultural tasks incurred by local government units in Poland in the years 2003- 2010 and the impact of the attempted application of the performance budgeting method to local government expenses relating to this field of economy.
The year 2013 is already the ninth year of implementing fiscal decentralization in the Slovak Republic. The aim was to ensure independence as well as responsibility of subnational governments and improve the ability to finance their original competences from own sources. As decentralization leads to growth of imbalance intergovernmental transfers are the instruments used by central government to reduce fiscal disparities and fill the gap between the spending needs and fiscal capacity of some local authorities. Tax sharing system in Slovakia, is an important tool of horizontal fiscal imbalance equalisation. Despite the title, shared taxes play the role of unconditional grants if even they are formally labelled as local government own revenues under current legislation. In this paper we examine the allocation of personal income tax share as an instrument of regional policy and factors affecting interregional disparities in Slovakia. The paper presents some results of the research project VEGA1/0822/11 Redistribution of financial resources in the decentralized fiscal system in Slovakia.
Abstract The process of decentralisation of public administration was based on the transfer of competences from state administration to municipalities and on the setting of new conditions for financing of municipalities. In the process of decentralization of public administration and fiscal decentralization, the range of original and transferred competences, as well as the tasks of municipalities and the corresponding instruments of financing, were set there by mutual agreement between the state bodies and the local self-government. The transfer of competences on municipalities in the field of education was not a simple process. The first steps in the management of schools and educational facilities did not entail without problems. Many of the misunderstandings grew up mainly from a lack of knowledge of the relevant laws governing the specific educational and training activities, operation, financing, personnel and material-technical provision of schools and educational facilities. The aim of the contribution is legislative and financial definition of current system of provision of services by municipalities in the Slovak Republic in the field of regional education, because this area is complicated and disorganized the laws dealing with education and its financing have undergone many amendments. The following compact and comprehensive issues can serve as a framework for further research.
The purpose of this article is to compare systems of fiscal decentralization in EU member states according to selected quantitative criteria. The results indicate that a higher number of lower levels of government usually indicate a greater share of local finance; however, this finding does not confirm the inverse link. Although the structure of expenditures is similar, the shares of funds for the implementation of individual tasks differ significantly. On average, the countries allocate most funds to education, social security, healthcare, and administration, with only a quarter of the countries recording the same or higher amounts of revenues than expenditures. Most countries still cover the existing deficit through transfers from the central government, equalization schemes, or borrowed funds.
The purpose of an article is to compare systems of fiscal decentralization in EU member states according to selected quantitative criteria and European Charter of Local Self-Government principles. The results show that a higher number of lower levels of government usually indicate a greater share of local finance within the total public finance, however, this finding does not confirm the inverse link. Even though the structure of expenditures in EU countries is similar, the shares of funds for the implementation of individual tasks differ significantly. On average, the countries allocate most funds to education, social security, healthcare, administration and political systems, with only a quarter of the countries recording the same or higher amounts of revenues than expenditures. Most of the countries still cover the existing deficit either through transfers from the central to lower levels of government or through equalization schemes or borrowing, which otherwise represents a departure from one of the basic principles of the Charter, which stipulates that financial resources must be commensurate with the responsibilities of local self-government.
The decentralization system impacts the change of the local tax regulation. Based on the Law No 34 of 2000 on local tax and retribution, local government may determine new kind of taxes besides what has established in this Law, but they must refer to the available criteria. Tax as one of the important local incomes to finance either the government operation or local development and to support the accountable, real, and extant decentralization . After the Law No 34 of 2000 has been replaced by the law No 28 of 2009 on local tax and retribution, local government is not allowed to pick up tax other than what the law has determined. The basis of the tax and the discretion is extended. To improve the tax accountability; this law stipulates that some parts of tax income should be allocated to finance activities relevant to such tax.<br /><br />Keywords : Local Tax
On the current stage, an important direction towards completion fiscal regulation is to regionalise economic and social processes, decentralize an important part of state functions on the local authorities. Herewith, to finance the expenditure by attaching appropriate income sources which will strengthen the role of local finances and assist the prosperity of regional economy. At the contemporary stage local budgets country, its separate regions development one of the most powerful leverage. Without them it is impossible political stability as in whole country, as in its separate regions. Local budget funds, social infrastructure forming are one of the major sources. Developed countries local budgets, density spare of social expenditures are higher than the state budgets. Local budget expenditures, especially on social provision spent funds promote in society social conflict softening that in contemporary conditions of each county’s sustainable development stipulating factor.
The current Albanian Constitution (1998) defines communes and municipalities (local governments) as the basic units of local governments. Local governments are legal entities and perform all the duties of self-government, with the exception of those that the law gives to other units. There are a total of 373 local governments units, consisting of 65 municipalities and 308 communes. While municipalities govern urban areas and the communes rural areas, there is no substantive legal distinction between them. The fiscal decentralization reform in Albania has addressed the issue of adequate local recourses proportional to the competences. The decentralization of functions were supported with an increase of financing opportunities either through the increase of transfers from the state budget or by adopting the new system of local taxes and fees, the latter one by providing total discretion to the local government in setting local tariff policies to cover the cost of their services. Unfunded mandates can represent a risk if not addressed in an appropriate manner. In this article we are going to discuss about the local resources as instruments to increase the autonomy of the local governments versus the resources from the central government. The balance between the resources from the central government and the local own revenue should be, as much as possible equal.
Polish Abstract: Rozwoj edukacji jest jednym z priorytetow polityki Unii Europejskiej od początkow jej istnienia. W ciągu ostatnich 15 lat szczegolny nacisk kladziony jest na modernizacje szkolnictwa wyzszego, ktore postrzegane jest jako kluczowe dla rozwoju zarowno calej Unii Europejskiej, poszczegolnych panstw czlonkowskich, jak i indywidualnych obywateli. Postulowane reformy wymagają zmian w obszarze zarządzania, jak i finansowania uczelni, a w szczegolności odejścia od scentralizowanego finansowania zorientowanego na zasoby w kierunku zdecentralizowanego finansowania zorientowanego na wyniki. Transformacja ta powoduje koniecznośc mierzenia efektywności i skuteczności szkolnictwa wyzszego w roznych jego aspektach, w tym rowniez w obszarze edukacji. Artykul koncentruje sie na badaniu mozliwości zastosowania modelu J. Mincera do mierzenia wplywu wyzszego wyksztalcenia na poziom wynagrodzen i wyznaczania tzw. prywatnej stopy zwrotu z inwestycji w edukacje. Badania empiryczne przeprowadzone są na danych pochodzących z niemieckiego badania panelowego SOEP.English Abstract: The development of educational system has been one of the priorities of European Union policy since the beginning of its existence. In the course of the last 15 years particularly strong emphasis has been placed on modernization of higher education, which is perceived as key factor for development of European Union, each member state separately, as well as individual EU citizens. The postulated reforms require changes both in the area of governance and funding of the universities, in particular a shift form centralized input oriented funding mechanisms towards decentralized outcome oriented financing is needed. This transformation causes necessity for measurement of efficiency and effectiveness of various aspects of higher universities activities, including education area. The paper focuses on application of Mincer model in analysis of higher education influence on the level of wages in order to determine the private rate of return to education. Empirical research have been conducted using the data from German Socio-Economic Panel Study (SOEP).
Financial decentralization, along with financial globalization, are currently two of the phenomena that concern professionals involved in reforming the local government finance and accounting systems, that are trying hard to become a language of communication for those interested in knowing the position and financial performance of local communities in Romania, as well as internationally. To meet the need of informing the taxpayers interested in knowing the methods of incorporation and usage of resources, of training financial creditors in administering their capacity for repaying any loans, as well as all the interest parties (including central government), local communities have turned to instruments they have at hand: budget and accounting.
This contribution is aimed at comparing fiscal autonomy of self-governing units after fiscal decentralization in the Slovak republic. Evaluated and compared are budgets of selected Slovakian towns with the accent on the budget incomes creation. The contribution evaluates the level of self-financing as the share of own incomes to current expenditure, and also the level of self-sufficiency as the share of own incomes (including local taxes and fees) to total incomes.
This paper is studying the degree of financial independence and decision of local authorities, in a number of transition countries in South-Eastern Europe. Our research identified the strengths and weaknesses of public finance reform, for each country, followed by a classification of decentralization in the analyzed area.
Tatiana Moșteanu, Carmen Maria Lăcătuş, Mirela Anca Postole
This paper work aims to identify the issues of Romanian local public decentralization, recommending measures to streamline the public finance circuit. The reorganization of the public government in three levels, the growth of the financial independence of local authorities and public administration’s decisions’ transparency next to a better information of citizens, coupled with their empowerment and involvement in public affairs, all these represents key points for the discharge of decentralization of public finances: to increase social welfare.
Bulgaria is one of the first countries from the former socialist block, which adopted a new democratic Constitution as early as 1991. The Constitution affirms the model of modern democratic state and outlines the principle of decentralization, admitting the right of self-government to the municipalities. Development of the legal frame of the local self-government and the enlargement of its functions, including the regulation of the financial independence of the municipalities, was accepted as a good perspective for further development of the local self-government. \n \nBased on the above the paper analyses: \n• Political, administrative and financial decentralization in Bulgaria as an integral part of the process of making public institutions more efficient, responsive and accountable to citizens; \n• Historical background of the decentralization process - undertaken reforms; adoption of legal texts; Constitutional amendment for providing local authorities with taxation powers; establishment of a joint Working Group on Financial Decentralization; adoption of a Concept and a Program for Financial Decentralization; creation of a system of incentives which target higher local revenues, consolidated financial management potential, and maximum level of local autonomy to determine the type, scope and provision of municipal services; division of municipal budget financed public services into two groups (state delegated and local); development of Strategy for decentralization and a Program for its implementation; \n• The impact of national and international (Council of Europe, European Commission) institutions and NGO’s on the decentralization process. \n \nThe purpose of the paper is not only to reveal the past reforms, but to stress on the present results and to examine the intergovernmental fiscal relations and local financial management. Unfortunately despite the positive changes, made in the first years after the period of centralized economy and governance, nowadays the local finance system is almost unchanged. Some of the ascertained problems might be summarized in the following: \n \n- Presence of permanent structural deficit in the municipal budgets, caused by the discrepancy between expenditure responsibilities and the income base; \n- Complicated, non-transparent and frequently changing transfer system; \n- Insufficient financing of delegated responsibilities; \n- Reduction of the recourses for municipal investments. \n \nThe experience in our country shows that a number of former decisions and initial intentions in the sphere of decentralization end with stabilization of the centralization. In this respect the paper searches arguments, connected with the reasons for the above described situation – is it a result from: \n• the unpreparedness of local government institutions and local stakeholders to operate in a reformed environment and the limited capacity to design, implement and monitor decentralization policies; \n• or from the wish for realizing a lot of changes for very short period of time; \n• or the reason is in the lack of political will.
Providing financial resources for public funds is difficult to effectuate and the central government and local government level. Since local budgets do not own income sufficient to ensure the financing of all expenditures on behalf of local collectivities, then the state budget provides funding for social, economic local destinations. Decentralization of public services is accompanied by financial descentralization. In this paper we present some aspects of VAT revenue from the state budget used to support certain activities at the local level, the evolution of these allocations in the context of current budgetary constraints due to financial crisis.
The research theme is important for the local economy and financial literature on local public finance. It is known that the tax base of the territories is quite uneven and providing quality public services is impossible based on their own sources. The support for less developed local public administration from the financial point of view requires fiscal decentralization and involves financial equalization procedures or other similar measures aimed at eliminating the effect of unequal distribution for potential funding sources. Financial equalization is a group of financial actions made in order to overcome economic and fiscal disparities between territories. The purpose of financial equalization is the additional funding of less developed territories in order to reduce regional disparities. Key words: financial equalization, fiscal decentralization, inter-budgetary
This paper presents the significance of the issues related to the activity of territorial self-government for the social and economic development of Ukraine. The efficient operation of self-government in any country is unfeasible without financial resources. Polish experience in the development of territorial self-government is particularly valuable in relation to the reform of Ukraine’s self-government. The paper outlines the differences in the structure and operation of territorial self-government in both countries. The paper is concluded with numerous observations on the direction of selected reforms of Ukrainian self-government. It shows the weaknesses of local self-government in Ukraine, which result from the lack of decentralization of finance and the small amount of state-collected taxes. The conclusions end with the observation that a consistent development of the Ukrainian state is required for Poland to develop well.
Due to the very large number of local units in the Republic of Croatia, the system of collecting income is mainly insufficient for quality and functional financing of public needs on the local and regional levels. It is therefore necessary to continue the search for new models of regulating financial relations between the state and local units. The executed decentralization of the financing of local and regional self-government is not sufficient. Because of the new work and activities that have fallen into the jurisdiction of counties (as regulated by Amendments to the Act from 2005), it is necessary to increase the state's allocation of funds from common taxes for the units of the local and regional self-government, to increase the autonomy of the local and regional units in the introduction of their own incomes, especially taxes, to take care about the implementation of functional decentralization, and to stimulate local and regional governments in the realization of a larger non-fiscal income of their own. It is a fact that some countries in the European Union have begun with the reorganization and reduction of their local self-government precisely because of too high financial payments for the needs of the local self-government. However, so long as the Republic of Croatia retains the existing organization of local governments, it should also provide for its financing. The local or regional self-government units' own sources of income should be their principal sources of financing.
Describing the process of public sector decentralization is a aim of the article. Increasing the responsibility and competence of local government units is aimed at a taken of decentralization process of the sector of the public finance. Thanks to granted competence, the local authority together with the community take decisions concerning the path of the development of given local government unit. In the article tasks and competence of government units on different level were discussed. Also critically, issues connected with financial resources of local government units and the connection of these resources with the expenses side were presented.