10 municipalities in "bankruptcy" in 2023, had debts higher than their own income

2024-08-05 07:45:00, Ekonomi CNA

10 municipalities in "bankruptcy" in 2023, had debts higher than their

At least 10 municipalities in our country were "bankrupt" in 2023, as they had outstanding debts higher than their own income.

According to the data of the Ministry of Finance, at least 10 municipalities have a fairly high ratio, over 100% of the stock of obligations of 2023 to their own income. Klosi (339%), Memaliaj (270%), Dibra (156%), Malësia e Madhe (139%); Puka, Peqini, Dimali, Cërriku (120%); Kavaja and Tropoja (110%).

The stock of arrears at the end of December 2023 from the Ministry of Finance is about ALL 4.8 billion.

The municipality of Kavaje has the highest stock of liabilities in the amount of 794 million ALL, which constitutes 16.7% of the total liabilities.

Then, the municipality of Tirana in the amount of 788 million lek, which constitutes 16.6% of the total liabilities; Vorë municipality in the amount of 363 million ALL, which constitutes 7.6% of the total liabilities; The Municipality of Durrës in the amount of about 311.5 million ALL, which constitutes 6.6% of the total liabilities; the municipality of Pogradec in the amount of about 224 million ALL, which constitutes 4.7% of the total liabilities. Then the municipalities of Dibër and Lezhë are listed.

According to the categories, the largest share of the liability stock is occupied by the category "Investments" with 47%, followed by "Others" 25%, "Services" 11%, and "Judgments" 9%.

In 2023, the weight of the stock related to outstanding investments has increased, as well as other activities, which are directly related to fiscal discipline at the local level. As for the counties, the stock of their obligation consists mainly of court decisions, which account for 95.9% of the total obligation of the counties.

The Ministry of Finance estimates that arrears continue to be a problem for 2023 as well. Last year, the Ministry of Finance prepared and published the financial status report for all 61 municipalities for 2022, where it was found that 49 municipalities and 9 districts are without financial problems, 8 municipalities and 1 district have financial problems and 4 municipalities and 2 districts have financial difficulties.

The stock of arrears during 2023 constitutes about 13.8% of the total own income of the local self-government units. Compared to a year ago, as a result of the increase in own income, this ratio has decreased by about 3.6% due to the reduction of liabilities and the increase in own income.

The stock of arrears of ALL 4.8 billion accounts for about 7% of the total actual expenses of the local self-government units.

The Ministry of Finance pointed out that the rather low fiscal capacity of most of these municipalities and the poor management of revenue collection and expenditure planning have created these problems in the stock of obligations./ Monitor