Number of staff at non-profit (non-commercial) legal entities (N(N)LEs) of the Samegrelo-Zemo Svaneti municipalities increased significantly
Since the 15 June 2014 local self-governance elections, the number of staff employed at the non-profit (non-commercial) legal entities established by Samegrelo-Zemo Svaneti municipalities has increased by 853, inflating the salary portion of their budgets by a total of GEL 460 thousand each month and GEL 5.5 million annually. N(N)LEs cover a range of functions, from sanitation through to childcare, to data collection.
According to the law, a “municipality can establish a N(N)LE for coordination of its activities”, the head of which is appointed and dismissed by the governor/mayor of the municipality. The head of the N(N)LE and the governor of the municipality make decisions regarding structure and staffing of the organization, along with hiring and dismissing employees and determining their salaries.
Transparency International Georgia requested public information regarding the number of employees of the N(N)LEs founded by Samegrelo-Zemo Svaneti municipalities in May 2014 and in July 2015, along with salary expenses for the respective periods.
The provided information has demonstrated:
In July 2014, 105 N(N)LEs were functioning in the municipalities of Samegrelo-Zemo Svaneti. By July 2015, this number had increased to 113. The number of employees of the N(N)LEs in the region soared from 5548 to 6401.
Only the N(N)LEs of Khobi municipality have downsized their staff -- by 14 employees.
Since the 2014 elections, the number of N(N)LEs in Tsalenjikha municipality has not increased, however the number of employees in the already existing organizations grew by 335 (the highest number in the region). This increase includes a surge from 285 to 570 employees at the Tsalenjikha Center for Sanitation and Landscaping, as well as an increase from 219 to 279 employees at the Center for Preschool Children. As a result, monthly salary expense of the Tsalenjikha municipality increased by GEL 154 313.3 in total, a significantly larger growth than in other municipalities.
Prior to the 2014 elections, there were only 17 N(N)LEs in the now-defunct Zugdidi municipality. As a result of the Local Self-Government reforms, two separate self-governing entities, Zugdidi Community and Zugdidi City municipalities were created. There are now 21 N(N)LEs in these two self-governing entities Not only did the number of organizations increase, but also the number of personnel at these organizations grew by 128, and the monthly salary expense in both municipalities inflated by GEL 117 415.3.
Apart from Zugdidi, 4 new N(N)LEs were also established in the municipality of Poti and 2 in the municipality of Mestia after the 2014 elections.
In 2015, Mestia municipality set up the Center for Cultural Heritage, while there already existed N(N)LEs working on cultural issues -- the Cultural Service of the Municipality of Mestia and the Department for Education, Culture, Monument Preservation, Sports and Youth of the Mestia Gamgeoba. We requested charters of both N(N)LEs, and discovered that the objectives of both organizations are to find, preserve and develop material and nonmaterial monuments of cultural heritage. Furthermore, we think that these functions can be easily performed by the Department for Education, Culture, Monument Preservation, Sports and Youth of the Mestia Gamgeoba, and it is not clear why the new legal entity was created to perform identical functions.
Four new N(N)LEs were founded in the self-governing city of Poti after the 2014 elections: City of Poti Municipality Center for Development of Tourism (21 employees), Viktor Kratasyuk Canoe Club (11 employees), the Cemetery Center for City of Poti (14 employees) and the Center for Social Research of City of Poti (64 employees). The main functions of the Center for Social Research of City of Poti are “to collect various types of information regarding socially vulnerable groups of citizens; to create a database of demographic processes; to create a database of the standard of living and economic activity status (employment information) of the population and etc”. At the same time, similar functions are performed by the Agency of Social Services and the National Statistics Office of Georgia, while some of the other functions of the above-mentioned center can be performed by the Department of Health and Social Protection of the Poti City Hall. It is, therefore, unclear, why the Poti municipality decided to set up such an organization, significantly increasing budgetary expense -- monthly salary expense for this N(N)LE is GEL 26 120, while the annual expense is on average GEL 313 414.
Furthermore, among 28 legal entities established by the City of Poti municipality 12 are sports organizations (School of Martial Arts, Handball Club Golden Fleece, Sport School of Rugby, Complex Sport School of Rowing, Canoe Club, Complex Sport School of Wrestling, Complex Sport School of Chess, Complex Sport School of Chess and Checkers, Complex Sport School, Sport School of Horse Riding, Sport School of Boxing, Complex Sport School for Water Sports, Sarsania Boxing Club). In our opinion, it is possible to merge the entities with similar or identical functions and mission into a single legal entity, preventing significant budgetary expense and saving monetary resources.
In the municipality of Abasha, number of N(N)LEs decreased from 10 to 8 - N(N)LE Main Library of Library Union was merged with N(N)LE Cultural Center of Abasha, and N(N)LE Cemetery Management Center of Abasha was merged with N(N)LE Abasha Maintenance Service.
For detailed information, please see the graphs:
TI Georgia believes that municipalities must decide based on the local needs what type of organization is necessary for effective functioning of the local government. Taking into account limited budgetary resources, they should mostly focus on saving administrative expenses and dealing with the essential needs of the citizens, utility and infrastructural projects.
Taking into account, the high unemployment rate in Georgia, local governments remain one of the main sources of employment. However, unreasonably inflated staff can be a heavy burden on limited budgetary resources of a municipality.
It must be noted, that unlike appointment to a public office, employment at N(N)LEs does not require going a competitive merit based process. Thus, a head of N(N)LE personally makes staffing decisions, which does not allow for employment of persons with higher qualifications who would have been chosen through open competitions. At the same time, qualifications of individuals appointed without open contests are under question.